SECP issues ESG guidelines to enhance corporate responsibility

By Our Correspondent
June 14, 2024
The picture shows the building of the Securities and Exchange Commission of Pakistan (SECP). — The News/File
The picture shows the building of the Securities and Exchange Commission of Pakistan (SECP). — The News/File

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has taken a significant step towards promoting responsible business practices and environmental stewardship with the issuance of Environmental, Social, and Governance (ESG) voluntary disclosure guidelines for listed companies.

The guidelines require listed companies to provide comprehensive disclosures on their ESG practices, including information on environmental impacts, social responsibility initiatives, and corporate governance frameworks.

The move, announced Thursday, includes amendments to the Listed Companies (Code of Corporate Governance) Regulations, 2019, aimed at bolstering board oversight responsibilities concerning sustainability priorities.

The issuance of the ESG guidelines marks a pivotal achievement under the SECP’s ESG regulatory roadmap introduced in 2022. The voluntary guidelines align with globally recognized sustainability reporting frameworks and offer foundational guidance to listed firms. All companies are encouraged to consider adopting the guidelines.

“The guidelines aim to foster transparent disclosures across environmental impact, social responsibility practices, and corporate governance structures,” the SECP said in a statement.Companies can choose to report their ESG performance through a standalone sustainability report, integrate the information into their annual report, or publish it directly on their website, according to the guidelines.

In a bid to ensure workplace safety and respect, the SECP has also introduced substantial amendments in the Corporate Governance Regulations mandating listed companies to develop comprehensive anti-harassment policies. Compliance with the Protection Against Harassment of Women at the Workplace Act, 2010, is now a requirement.

Boards of listed companies are now tasked with setting sustainability priorities, proposing the formation of sustainability committees, and aligning with the SECP’s ESG disclosure guidelines.