Kuala Lumpur, October 30 — Norway’s sovereign wealth fund, Norges Bank Investment Management (NBIM), has proposed a more flexible approach to sustainability reporting for Bursa Malaysia’s upcoming National Sustainability Reporting Framework (NSRF). This recommendation comes as a response to the planned framework, which aims to enhance sustainability disclosures for Malaysian listed companies. 

With assets amounting to $1.67 trillion (RM7.3 trillion), the NBIM manages significant investments in Malaysia, including RM10.95 billion in local stocks as of June. In a consultation letter to Bursa Malaysia dated October 22, the fund expressed concerns that mandatory disclosures of prescribed common sustainability matters might not be relevant for all listed companies. 

The proposed NSRF includes a set of common sustainability topics—spanning from anti-corruption to waste management. However, NBIM suggests that these topics be replaced with disclosures focused on the material environmental and social impacts of each company’s operations and supply chains. The fund encourages firms to conduct their own materiality assessments and to use the Global Reporting Initiative (GRI) standards as a guideline for reporting. 

This proposal aligns with a broader shift toward more customized sustainability reporting, emphasizing the need for adaptability as regulations, consumer preferences, and technological landscapes evolve. The NSRF will be implemented in phases, starting in 2024 with Main Market-listed firms that have a market capitalization of RM2 billion and above, eventually expanding to all Main Market companies by 2026 and to the ACE Market by 2027. 

As Malaysia strives to enhance its ESG initiatives and carbon neutral strategy, this input from one of the world’s largest sovereign wealth funds could significantly influence the country’s sustainability reporting landscape. 

Sources:  

https://theedgemalaysia.com/node/732278 

https://www.nbim.no/en/publications/consultations/2024/bursa-malaysias-consultation-on-amendments-to-main-market-listing-requirements-on-sustainability-disclosures/ 

https://theedgemalaysia.com/categories/malaysia?page=2995& 

https://www.intellinews.com/norway-s-sovereign-wealth-fund-boosts-equity-investments-in-malaysia-338921/