Floods enhanced the need for identifying ESG issues and risks: SECP Chairman

ISLAMABAD, Oct 01 (NNI): The Chairman Securities and Exchange Commission of Pakistan (SECP) Aamir Khan stated that the recent damage caused by floods in Pakistan, has enhanced the need for identifying Environmental Social and Governance (ESG) issues and risks due to climate change from a local perspective.
He was addressing the 20th Anniversary Celebration Event of CFA Society Pakistan. The subject was Pakistan Capital Markets 2002 – 2042. Former minister for Finance and Revenue Dr. Miftah Ismail Sahib, President CFA Society, Abdul Rehman Warraich, Advocacy Chair, CFA Society, Mohammad Shoaib and Ms. Sima Kamil, Deputy Governor, SBP were also present.
Aamir Khan said SECP considers sustainability as a priority in its regulatory agenda. He told participants that the SECP, through consultation with all stakeholders, has proposed an ESG regulatory roadmap with key milestones for capital markets. Through Listed Companies (Code of Corporate Governance) Regulations, 2019, based on comply or explain approach, board of directors are required to have ESG policy in place and disclose implementation of ESG initiatives, he explained the ESG roadmap.
The SECP has also unveiled guidelines for the corporate sector to raise funds from the capital market to finance or refinance projects that contribute positively to the environment. All issuers who are eligible to issue debt securities, including sukuk either by way of public offer or private placement are eligible to issue green bonds while ensuring compliance with applicable regulatory framework.
He pointed out that environmental, social and governance factors are gaining traction in the capital market, as investors are increasingly incorporating sustainability factors into their investment decisions. He hoped that these efforts will pave the way for promoting ESG based investing, enhancing ESG disclosures and launch of ESG-based financial products and ESG based Index at Pakistan Stock Exchange in due course.
SECP supports initiatives that foster competition and inculcate ethical decision making, both internally and in our regulated sectors. The SECP, in the past three years, has introduced various reforms in local markets for promoting transparency, ensuring consistent regulatory actions, and leveraging technology. In achieving our goals, we are ensuring that our policies and decisions conform to values of Objectivity, Integrity and Equitability.
He applauded the efforts of CFA Society Pakistan for playing an effective role in raising awareness, capacity building and research in issues related to corporate governance, sustainability and ESG based investing. NNI