Stock Exchanges Implement Sustainable Development Reporting Guidelines

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Commencing May 1st, the Shanghai Stock Exchange, Shenzhen Stock Exchange, and Beijing Stock Exchange have formally enacted  the “Guidelines for Sustainable Development Reporting by Listed Companies.” These guidelines mark the the first unified and standardized Environmental, Social, and Governance (ESG) disclosure standard for A-shares. They will direct and regulate listed companies in releasing “Sustainable Development Reports” or ESG Reports.

Approximately 457 A-share listed companies are currently subject to these guidelines and must  disclose their 2025 Sustainable Development Reports by 2026 at the latest.The guidelines are founded  on a four-element disclosure framework: governance, strategy, impact, risk, and opportunity management, and indicators and targets. They emphasize the significance of disclosing financially significant issues within this framework, promoting improved  internal governance and high-quality information disclosure.

The guidelines establish mandatory disclosure requirements for companies listed in significant indexes and those listed domestically and overseas. Other listed companies are encouraged to voluntarily disclose, provided they adhere to the guidelines to standardize information disclosure and enhance comparability.

Officials from the China Securities Regulatory Commission’s Listing Department emphasized that ESG is crucial in guiding listed companies towards green and low-carbon development, supporting the creation of a sustainable environment, and mitigating investment risks.

Index providers and ESG rating agencies, such as CSI, CICC, Wind, Shangdao, and China Chengxin International, will integrate the guidelines’ content into their ESG rating systems to strengthen the domestic ESG rating system.Industry insiders anticipate that the implementation of the guidelines will enhance information comparability and transparency.