15 African Stock Exchanges to adopt Sustainability Reporting Standards

Copy right: footprint2africa.com

As many as 21 more of the world’s stock exchanges could introduce sustainable reporting standards by the end of 2016, according to James Zhan, Director of the Division on Investment and Enterprise at the United Nations Conference on Trade and Development (UNCTAD) which co-organizes the Sustainable Stock Exchanges (SSE) initiative.

SSE is a peer-to-peer learning platform for exploring how exchanges can work with investors, regulators and companies to enhance corporate transparency on environmental, social and corporate governance (ESG) issues to improve performance.

It was launched by United Nations Secretary General Ban Ki-Moon in 2009 and now includes more than 60 stock exchanges, representing over 70 per cent of listed equity markets and 30, 000 companies with a market capitalization of more than $55 trillion.

SSE works by distributing model guidelines for use by partner stock exchanges and their listed members; through a biennial series of Global Dialogues, regional dialogues and high-level summit side-events events; capacity building; and research to continue to promote sustainable and transparent capital markets worldwide.

“21 stock exchanges have confirmed to us they will introduce new guidelines either this year or within the first quarter of next year, and we know that many of them are close because they have posted draft guidelines on their websites for comment and discussion,” Zhan said.

He noted that by reporting on sustainability issues, companies also tend to act more sustainably. Analysts are finding a positive correlation between sustainable performance and strong financial performance which may be the incentive.

SSE Coordinator Anthony Miller said that with market expectations shifting quickly, more stock exchanges are viewing sustainability reporting as necessary and inevitable.

The Egyptian Exchange and the Johannesburg Stock Exchange were the continent’s first SSE Partner Exchanges.

Botswana, Kenya, Malaysia, Mauritius, Morocco, Namibia, Nigeria, Rwanda, Seychelles, Tanzania, Tunisia, Zimbabwe and Western Africa’s BVRM have also made a public commitment to sustainability in their markets.

The SSE is co-organized by the UN Global Compact, the UN Environment Program Finance Initiative (UNEP FI) and the Principles for Responsible Investment (PRI).

It continues to invite exchanges globally to become a Partner Exchange of the SSE by making a voluntary public commitment to promote improved ESG disclosure and performance among listed companies.

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