Bursa Malaysia, London Stock Exchange Group to Expand ESG Collaboration

Bursa Malaysia Berhad and the London Stock Exchange Group (LSEG) signed a Memorandum of Understanding (MoU), in order “to expand the ESG collaboration between the two exchanges as well as explore new areas of opportunity.”

Under the MoU terms, Bursa Malaysia and FTSE Russell, LSEG’s global multi asset index and benchmark provider, will “expand its coverage of ESG scores to include all PLCs listed on the Main and ACE Markets.”

Currently, ESG scores are only “available for PLCs that are part of the FTSE Bursa Malaysia EMAS (FBM EMAS) index, which account for approximately 30% of total Malaysian PLCs.” This expanded coverage will “enable more PLCs to better measure their ESG performance.”

Datuk Muhamad Umar Swift, Bursa Malaysia’s Chief Executive Officer, said:

“The signing of today’s MoU signifies another important step in the Exchange’s efforts to facilitate greater quality of ESG disclosures among Malaysian PLCs, which is in line with the Exchange’s aspiration to elevate them as regional leaders in the ESG space. We have been working with LSEG to build a stronger suite of ESG products. Following the launch of the FTSE Bursa Malaysia Top 100 ESG Low Carbon Select Index Series in August 2022, this MoU we are signing today is an extension of our partnership, and we hope that it will bring more successes to our institutions.”

Cornelia Andersson, Group Leader, Sustainable Finance and Investment at LSEG said:

“This agreement with our long-term partners Bursa-Malaysia will yield a significant increase in the ESG data and analytics available on listed companies in Malaysia. We are also exploring the development of an ESG corporate reporting solution to increase disclosure of climate related risks and opportunities for investors. It follows the launch of a new ESG and low carbon benchmark covering the largest listed issuers on the Exchange.”

The MoU will also “see the Exchange and LSEG collaborate on ESG educational initiatives, support the implementation of sustainable supply chain finance and transition financing workflows among Financial Institutions (FI), as well as explore corporate ESG reporting solutions that are aligned with internationally recognized standards such as the Task Force on Climate-Related Financial Disclosures (TCFD).”

All of these would aid in “enhancing PLCs’ ESG practises and disclosures, address the Malaysian FIs’ climate-related requirements, while also supporting the Exchange’s goal of being a sustainability catalyst in the Malaysian capital market.”

Datuk Muhammad Umar Swift added:

“We believe that the outcome of this MoU will result in improved performance and stature of our PLCs, as well as sustained investor interest in our capital market, benefiting Malaysia’s economic growth overall.”

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