Singapore Exchange:Understanding Sustainability from an Investor’s perspective
Understanding Sustainability from an Investor’s perspective
What is Sustainability and why is it relevant to an investor?
Why invest in companies that practise sustainability and adopt sustainability reporting?
Where do I find sustainability information on listed companies?
What are some key issues to look out for in the annual report and what questions should you ask at the AGM?
SGX is pleased to introduce a new online guide, “Reading Sustainability Reports”, to help investors make better use of sustainability reports and assess the information published by the companies they invest in. The new guide is part of SGX’s ongoing efforts to promote investment literacy and deepen the understanding of investment matters.
Corporate sustainability aims to create long-term value in a firm by incorporating the management of environmental and social risks into business strategy. Key components of sustainability are transparency, materiality, governance and stakeholder engagement. Financial disclosures only form one part of the overall picture of a company’s performance and prospects. Environmental and social issues have significant effects on the valuation and financial performance, but are at times, overlooked by investors.
In keeping with the global trend towards increased sustainability reporting, investors should equip themselves by examining the published reports, identifying potential risk factors and evaluating the mitigating measures companies pursue. With greater awareness of environmental, social and governance issues, investors will also be better empowered to question companies at Annual General Meetings.