Insurers listed in Singapore will be required by SGX to start making emissions disclosures in 2025, the same time frame announced by Hong Kong earlier this year.
The International Sustainability Standards Board financial standards IFRS S1 and its adjunct IFRS S2 had a putative start date of 1 January 2024 but implementation has been patchy globally.
In a recent release the Singapore Exchange Regulation (SGX RegCo) announced that the enhanced sustainability reporting regime would be implemented following ‘broad support’ from respondents to a public consultation.
From next year, Singapore-listed insurers must report their Scope 1 and Scope 2 greenhouse gas emissions – those resulting directly from the reporting firms’ activities, and those linked to the energy they have purchased.
Critically for SGX listed carriers the exchange has delayed implementation of Scope 3 emissions – the result of activities from assets not owned or controlled by the reporting organisation.
A climate reporting expert told (Re) in Asia in December last year that the scope 3 segment of the standards was particularly complex for insurers given the extent of their third party exposures via investment portfolios and underwriting activities.
According to the SGX release, respondents to its consultation also highlighted challenges, ‘particularly for smaller issuers’, in relation to the evolving measurement and reporting methodologies for Scope 3 emissions.
“SGX RegCo will therefore review issuers’ experience and readiness before establishing the implementation roadmap for reporting Scope 3 GHG emissions. The current plan is to prioritise larger issuers by market capitalisation with the intention that they report Scope 3 GHG emissions from FY 2026.”
There are three insurance sector firms listed on SGX: Great Eastern, which has a market cap of S$12.2bn ($9.4bn), United Overseas Insurance (S$431.8m), and admin firm V2Y.
In April the Hong Kong Exchange (HKeX) proposed a similar timeframe for implementing the various aspects of the greenhouse gas reporting standards while the Hong Kong Institute of Certified Public Accountants (HKICPA) announced that local versions of IFRS S1 and S1 would be effective from August 2025.
There are a total of nine global and regional insurers listed on HKeX including Asia’s second largest by market cap, Ping An, as well AIA, AIG, and China BOCOM.
It’s not just Asian exchanges which are having difficulties implementing scope 3 standards. The US Securities and Exchange Commission recently dropped implementation of this aspect of reporting standards in the face of a number of lawsuits.
