Compliance to Article (76) of the Chairman of SCA Board Decision No (03 RM) of 2020
Compliance to Article (76) of the Chairman of SCA Board Decision No. (03 R.M.) of 2020
Sustainability Reporting:
Responsible investing is one of the key factor considered by the investors globally in their investment analysis since several research studies provided evidence that Companies that adopt sustainability practices often financially outperform their peers.
UAE Vision 2021 and Abu Dhabi Vision 2030 also highlights the importance of sustainability and has deployed extensive efforts towards driving sustainability forward in the country which is in alignment with UN Sustainable Development Goals.
The term ESG (environmental, social and governance) is predominantly used in capital markets to describe the sustainability or environmental, social and governance issues that investors look at to determine the companies’ ability to hedge sustainability related risks and identify new opportunities to create long term value for stakeholders. Sustainability management is the integrated management of economic, social and environmental performance for the purpose of maximizing benefits to all stakeholder groups.
Importance of Sustainability Reporting:
- Investor interest in sustainability reporting
- Enhanced Competitiveness
- Risk management
- Building trust and reputation
- Enhance access to information
Mandatory application to all UAE PJSC listed companies for the year 2020 and onwards:
In line with UAE’s vision and commitment to drive sustainability, Securities and Commodities Authority (SCA) of UAE has mandated the public joint stock companies listed in the UAE to disclose the Integrated reporting (sustainability reporting) vide Article (76) of the Chairman of SCA Board Decision No. (03 R.M.) of 2020 concerning adopting the Corporate Governance Guide for Public Joint Stock Companies.
Clarification issued by SCA provides more details on the contents of the report and requirement to publish such reports.
Abu Dhabi Stock Exchange had also issued a guidance previously to support the Companies in disclosure of ESG information, which has 31 ESG indicators that are considered essential to report in alignment with global practices and the report should comply with Global Reporting Initiative (GRI) standards, applicable sustainability standards and requirements that are issued by the UAE stock markets.
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