KUALA LUMPUR (Oct 30): The manager of Norway’s sovereign fund, the largest in the world, has proposed Malaysia’s planned National Sustainability Reporting Framework (NSRF) to do away with blanket common sustainability matters and have a more flexible method.  

Norges Bank Investment Management (NBIM), the manager of the US$1.67 trillion (RM7.3 trillion) Norwegian Government Pension Fund Global — which held RM10.95 billion in Malaysian stocks as at end-June this year — said it would not recommend mandatory disclosure of the NSRF’s prescribed common sustainability matters as they may not be the most relevant for all listed issuers.

“Regulations, consumer preferences, technology, physical environments and stakeholder expectations change over time, and we expect companies to conduct their own materiality assessment,” NBIM said in a consultation letter to Bursa Malaysia dated Oct 22 sighted by The Edge.

The letter followed was part of feedback from the public sought by Bursa Malaysia on the proposed sustainability reporting enhancement.

The sustainability reporting framework was launched last month, governing Malaysian listed companies. 

It will be implemented on a phase-to-phase basis beginning with Main Market-listed firms with a market capitalisation of RM2 billion and above beginning next year.

To reduce the reporting burden for listed issuers, NBIM recommended removing the blanket list of "common sustainability matters" in the framework, which covers 11 subjects from anti-corruption to data privacy and waste management matters.

In its place, NBIM proposes listed issuers disclose material environmental and social impacts of their operations and value chains, while referring to the Global Reporting Initiative (GRI) standards as guidance. 

By 2026, the framework will be extended to all Main Market companies, and later in 2027 to include all ACE Market companies, and non-listed firms with annual revenue of RM2 billion and above as well. 

The phased implementation will begin reporting with International Sustainability Standards Board’s (ISSB) IFRS S1 and S2 standards before later being expanded into Scope 3 emissions disclosures.