The private sector and United Nations join forces to enhance transparency on ESG information across global markets

SSE Model Guidance

Less than a third of stock exchanges worldwide provide written guidance to their listed companies on environmental, social and governance (ESG) disclosure. In response to this, the United Nations Sustainable Stock Exchanges (SSE) initiative, along with a diverse advisory group led by London Stock Exchange Group, has created a new resource for exchanges. Today, representatives of the SSE initiative, along with nearly 100 investors, joined at the London Stock Exchange for this morning’s market open to officially launch the SSE’s new resource for exchanges – the Model Guidance on Reporting ESG Information to Investors: A Voluntary Tool For Stock Exchanges to Guide Issuers. The ceremony also marks the start of a global campaign to have all exchanges provide their issuers with written guidance on reporting ESG information by the end of 2016.

The campaign is off to a successful start with the Bucharest Stock Exchange, Egyptian Exchange, HoChiMinh Stock Exchange, Hanoi Stock Exchange, London Stock Exchange Group, Nigerian Stock Exchange and Santiago Stock Exchange all making early public commitments.

The purpose of the Model Guidance is to help exchanges address the current information gap by providing a model that exchanges can use to develop their own custom guidance. It was developed thanks to the leadership of exchanges from around the world, and support from a multi-stakeholder advisory group composed of investors, companies and industry experts. Chairing the advisory group, David Harris of London Stock Exchange Group/FTSE worked with the more than 50 advisory group members over six months to ensure that the document was relevant, useful and most importantly, effective.

The release of the Model Guidance and its call for exchanges to provide ESG guidance will be supported by a written campaign led by Allianz Global Investors. The campaign, backed by the Principles for Responsible Investment and United Nations Global Compact, will write to all WFE members and SSE Partner Exchanges, commending those exchanges that already issue ESG reporting guidance and encouraging those exchanges that don’t to create their own by the end of 2016. Companies, asset owners and managers are invited to sign the campaign’s letter (deadline 5 October 2015) to show that they support exchanges globally taking concrete steps to create more transparent and long-term markets. For details or to join the campaign, email danielle.chesebrough@unpri.org. To view the progress of the SSE campaign, please visit the SSE website.

Contributing to this momentum building around ESG reporting, the World Federation of Exchanges (WFE) Sustainability Working group (SWG) plans to release a complementary document later this year that will highlight areas of ESG practice and disclosure that are of utmost relevance for individual exchanges and exchanges as an industry in general. The SSE’s Model Guidance is a key document for this work; similarly, all the major reporting frameworks are being examined for guidance on specific metrics for performance measurement in each of these highlighted areas.

For more information about the SSE Model Guidance, please email info@sseinitiative.org.

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