Malawi Stock Exchange (MSE) says it has made sustainable reporting mandatory for listed companies to align the 16-counter market with global regulatory landscape on transparency.
Sustainability reporting is the disclosure and communication of environmental, social and governance (ESG) goals as well as a company’s progress to improve its reputation and build consumer confidence.
In communication addressed to stakeholders, MSE said it plans to train leadership of the listed companies on how to comply with sustainable reporting basics before the enforcement of compliance.
In an interview on Saturday, MSE chief operations officer Kelline Kondowe said the need for sustainability reporting is a strategic move to align the market with the shifting regulatory landscape to encourage transparency of businesses on sustainability performance.
She said: “As a country, we have committed to pursuing attainment of the Sustainable Development Goals and in doing so, it has been acknowledged that businesses have a key role to play in attainment of the goals.
“As such, we have a responsibility of ensuring that we provide a conducive regulatory framework that will facilitate disclosure of sustainability performance.”
Kondowe said through the assessments involved in setting up sustainability frameworks, businesses have an opportunity to understand and take into consideration their stakeholders’ needs, which in the long-term ensures survival and sustainability of the business.
Stockbrokers Malawi Limited equity investment analyst Kondwani Makwakwa said in an interview on Sunday that MSE’s direction is proactive, noting that in the near future, corporates that ignore ESG will face serious issues such as higher operational costs and reputation damage, among others
He said: “With growing global pressure for businesses to adopt sustainable practices, MSE is helping listed companies stay ahead of evolving standards. This not only protects their interests, but also benefits investors.”
Meanwhile, an environmental activist Mathews Malata has described MSE’s initiative as an important step towards ensuring that businesses operate responsibly and sustainably.
He said if successfully implemented, the move will enhance transparency and accountability in business operations, leading to better management of environmental and social risks.
Benefits of sustainability reporting include improved corporate reputation, building consumer confidence, increased innovation and even improvement of risk management.
