KUALA LUMPUR: Bursa Malaysia and three neighbouring exchanges have collaborated on the ASEAN-Interconnected Sustainability Ecosystem (ASEAN-ISE) to advance ASEAN’s sustainable development through the implementation of common environmental, social and corporate governance (ESG) metrics in their respective data infrastructures.

The other partner exchanges are the Indonesia Stock Exchange (IDX), The Stock Exchange of Thailand (SET), and the Singapore Exchange (SGX Group). The ASEAN-ISE initiative was formalised at a recent meeting between the partner exchanges, marking an agreement on the foundational governance structure and operational blueprint for building the interconnected sustainability ecosystem.

According to a joint statement, Bursa Malaysia will serve as the ASEAN-ISE Secretariat to facilitate the successful
execution of its objectives. The intended outcomes of the ASEAN-ISE initiative include creating an integrated environmental, social, and corporate governance (ESG) ecosystem to promote the progress of sustainable development in ASEAN.

The focus is also to enable participating exchanges to achieve economies of scale through cost efficiency and faster time-to-market with fit-for-purpose solutions. Further, the partnership aims to empower the participating exchanges to proactively assist ESG-compliant corporates in maximising business value through quality disclosures.

This involves developing infrastructure solutions to facilitate cross-border trade flows, connecting corporates’ supply chains to ESG-oriented investment capital and providing suppliers with good ESG practices and disclosures to secure more competitive financing rates.

Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift said this most recent development aligns with the exchange’s intent to broaden participation from exchanges in the ASEAN region and beyond. “Together, we envisage an open and inclusive ecosystem in which the participating exchanges in ASEAN operate a trusted and fundamentally aligned data infrastructure.

“Comprehensive sets of modular-based, fit-for will support this purpose and cost-efficient solutions that can be deployed in response to the participating exchanges’ specific market needs and conditions,” he said in the statement. IDX president director Iman Rachman said the addition of SGX to the interconnected sustainability ecosystem initiative reflects the strong collaboration of stock exchanges in ASEAN to bolster the sustainable finance ecosystem in the ASEAN capital markets.

“This is a step forward in promoting the implementation of the recently announced ASEAN Common ESG Core Metrics and encouraging responsible business practices among listed companies in ASEAN stock exchanges,” he said. SGX chief executive officer Loh Boon Chye said in witnessing the profound impact of climate change in this region,  collaboration has become increasingly important for members in ASEAN Exchanges.

“SGX Group acknowledges the urgency for timely action and, two years ago, launched ESGenome, the online data portal for public listed companies to facilitate sustainability and climate-related reporting.

“As such, we look forward to working together with the members to standardise data to create interoperable datasets that will reinforce our collective efforts to drive capital towards sustainability efforts and address climate change in the region. “By sharing our expertise and coordinating efforts, we can mobilise capital for sustainable financing, contributing to a more economically and climate-resilient ASEAN community,” he said. SET president Pakorn Peetathawatchai said the inclusion of SGX Group strengthens the alliance, uniting key regional players.

“Together, we set new standards for responsible business practices, encouraging corporates to integrate the ASEAN Exchanges Common ESG metrics. “Our collective commitment reflects a shared vision for a sustainable and resilient financial ecosystem that positively impacts our societies, economies, and the world at large,” he said. As part of the ASEAN-ISE implementation, the participating exchanges have agreed upon outcome-driven collaboration deliverables that consider local considerations and the maturity level of their respective markets.

Significantly, the participating exchanges will commit to adopting and implementing the ASEAN Exchanges Common ESG Metrics in
their ESG reporting platforms.