Australian stock exchange considers joining sustainability initiative

The Australian Securities Exchange (ASX) could become the next stock exchange to join a UN initiative promoting sustainability, according to reports. The Sustainable Sock Exchanges (SSE) initiative currently has ten partner exchanges.

The ASX has said it is “considering the progress” of the UN-backed SEE, according to the Financial Standard website. The exchange added that it “broadly supports” the objectives of the initiative but added that it already pursues “efforts regarding sustainability in other ways”.

In its corporate governance principles and recommendations, ASX states that listed companies should disclose information around risks relating to the economy, environment and social sustainability, as well as highlighting how the company will manage the risks.

The comments follow the London Stock Exchange (LSE) becoming a partner in the SSE earlier this month. Mark Makepeace, group director of information services at LSE, said, “Ultimately [sustainability] is about supporting stable global long-term economic growth.”

The SSE aims to explore how stock exchanges can work with investor, regulators and companies can enhance corporate transparency and encourage sustainable investment, across a range of environmental, social and governance (ESG) areas.

Participating stock exchange make a voluntary public commitment to promote improved ESG disclosure and performance among listed companies.

The role of stock exchanges in the sustainable investment market has been debated. Some have defined it as “nothing more than greenwash”, whilst the UN-supported Principle for Responsible Investment has argued that stock exchange are playing an increasingly prominent role in enhancing corporate sustainability reporting.

A report, published last year, ranked the world’s stock exchange on the extent their large listed companies disclosed a range of sustainability indicators, including energy, greenhouse gases and employee turnover. European stocks were ranked favourably, with eight of the top 10 coming from the continent.

Photo: ngould via Freeimages  

Further reading:

London Stock Exchange joins UN sustainability initiative

Stock exchanges announce commitment to sustainable investment

Ceres initiative looks to boost stock exchange sustainability reporting

FTSE: sustainability at the world’s leading investment index provider

Role of stock exchange in sustainable investment up for debate