On June 7, the Taiwan Stock Exchange (TWSE) introduced a new ESG reporting mandate for listed companies on both the TWSE and the Taipei Exchange (TPEx). Under the new rule, companies are required to publicly disclose relevant information regarding their ESG practices and development status on an annual basis.
The TWSE stated that the mandate was created in response to growing demands from investors for more ESG-related disclosures. It expected that in the long run, the disclosure mandate (in combination with the sustainability development road map launched by the Financial Supervisory Commission in March 2022 to curb greenhouse-gas emissions) will strengthen investor confidence and attract additional domestic and foreign investment.
To facilitate this enhanced reporting, on May 31, TWSE launched an ESG information and inquiry platform on its Market Observation Post System (MOPS) for companies’ disclosures and stakeholders’ questions. Initially seven main topics were covered on the platform:
- greenhouse-gas emission,
- energy management,
- water management,
- waste management,
- human resource development,
- the board of directors, and
- investor communications.
These seven topics are further divided into 29 indicators to provide in-depth metrics, such as levels of renewable energy usage, water consumption and hazardous waste discharge, employee average salary, work-related injury rate, and percentage of women in management positions. Stakeholders can access this information for individual companies, and see the breakdown for entire industries.
The ESG information disclosed on MOPS is not always comprehensive. For example, some (mostly small- and mid-size) companies’ emissions data is either unaudited or missing entirely. Nonetheless, the new regulatory mandating of ESG disclosure is an important step forward for Taiwan-listed companies, both for promoting sustainable development and attracting more long-term capital from international investors.
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