NSRF enhances transparency

THE Securities Commission (SC) launched the National Sustainability Reporting Framework (NSRF) in September 2024 to provide clear guidance for its implementation phase, aiming to encourage corporate Malaysia to prioritise sustainability disclosures.

The NSRF also introduced additional responsibilities for companies and Bursa Malaysia to ensure reporting data is consistent, measurable and comparable.

In terms of reporting, the SC has outlined a phased-in timeline for different groups of companies based on their size and listed markets.

Main Market companies with a market capitalisation of more than RM2bil are categorised as Group 1, followed by other Main Market companies in Group 2, and ACE Market companies and large non-listed companies in Group 3.

Group 1 companies will begin reporting this calendar year, effective for those with a year-end on Dec 31, 2025 or after. Group 2’s effective date is for companies with a financial year ending on Dec 31, 2026 or after. Group 3 is for companies with a financial year ending on Dec 31, 2027 or after.

The SC has also supported implementation through the Advisory Committee on Sustainability Reporting’s (ACSR) PACE initiative.

PACE helps companies to build their capability, capacity and have the right resources to ensure NSRF is met, especially for the early adopters under Group 1.

Listing requirements

Since the introduction of the NSRF, many companies, especially among those in Group 1, have made great strides in ensuring that they have the resources and capability to meet the Bursa Malaysia Listing Requirements related to sustainability reporting, which aligns with the NSRF.

In the enhanced Listing Requirements for Sustainability Reporting announced in December 2024, Bursa Malaysia made it clear the use of International Financial Reporting Standards (IFRS) S1 General Requirements for Disclosure of Sustainability-related Financial Information and IFRS S2 Climate-Related Disclosures as the baseline standards for sustainability reporting in Malaysia.

According to Bursa Malaysia, these enhancements are designed to improve the transparency and accountability of how listed issuers manage their sustainability-related risks and opportunities using a globally recognised standard, strengthening business resilience and easing the reference and comparability for investors.

Mandatory platform

Following the enhanced listing requirements for sustainability reporting, Bursa Malaysia has made it mandatory to use a prescribed format for sustainability disclosures through the exchange’s Centralised Sustainability Intelligence (CSI) Platform, effective Dec 15, 2025, as part of its efforts to strengthen alignment with international disclosure standards.

The CSI Platform will be provided to companies at no cost, replacing the now-discontinued Environmental, Social and Governance (ESG) Reporting Platform.

Hence, the CSI Platform is now the single official platform for companies to report sustainability matters to Bursa Malaysia in a standard and prescribed format.

Positive move

The CSI Platform was introduced as a platform for listed companies, which is equipped with modules and tools for listed companies to submit the necessary quantitative and qualitative data, which addresses challenges faced by many companies in meeting the exchange’s listing requirements.

Nevertheless, companies using the CSI Platform will need to ensure that it has the right capability and resources to input data into the platform, whether from in-house expertise or other outsourced sustainability solution providers.

The use of the CSI Platform by all listed issuers will also address another challenge faced by many companies, which is the evolving nature of sustainability reporting and new standards. The CSI Platform will also incorporate any regulatory or financial reporting changes, and with that, reporting under the platform will be uniform, measurable and comparable.

Cost efficiency

Credit must be given to Bursa Malaysia for providing the CSI Platform. Without a common platform, companies would incur additional costs.

The real issue is the availability of resources and manpower, as sustainability measurement and reporting require skilled talent, dedicated personnel for data collection, task delegation, record keeping and reporting key inputs based on Bursa Malaysia’s Listing Requirements.

While outsourcing is an option, it may not be practical for large companies and remains costly for smaller ones depending on the support needed.

Sustainable investing

While there has been some pushback from the United States and European Union on sustainability practices and reporting, Malaysia’s position is reinforced by an enhanced sustainability reporting framework.

This framework provides companies with a unified platform for reporting that simplifies sustainable investing, particularly for sustainability-mandated funds.

As sustainability issues are today a core belief among investors and corporations, it is a sigh of relief to see that our regulators are still pushing hard.

This is to ensure not only compliance with the listing requirements but also uniformity, which will ensure investors are fed with information that is accurate, comparable, measurable and consistent.

The regulatory push from both the SC and Bursa Malaysia will also ensure that our listed companies are well prepared to meet the challenges brought about by the financial reporting demands under the IFRS.

This will also ensure that Malaysia remains committed towards achieving climate-related targets and towards net zero green-house gas emissions by 2050.

The enhanced sustainability reporting framework using the single CSI Platform is seen as positive for listed companies as well as for investors making investment decisions using sustainability measures.

The IIC welcomes the NSRF and the efforts by both the SC and Bursa Malaysia, and we expect, as institutional investors, that it is not to be used as a marketing tool but for proper reporting to be done to communicate across the sustainability journey of the listed companies.

Ultimately, high-quality sustainability disclosures are not about more pages – they are in essence about better insight.

Investors want to differentiate between companies that are complying today and those that are competing for tomorrow.

It is also about seeing how sustainability links to long-term value creation – and giving investors the confidence to keep investing, not just in the company, but in its future.