More investors looking at non-financial performance

KUALA LUMPUR, Nov 29 (Bernama) -- Investors and lenders globally are increasingly looking at companies' non-financial performance to assess the extent to which companies manage risk and leverage opportunities for their business, according to CSR Asia.

CSR Asia, the leading provider of information, training, research and consultancy services on sustainable business practices in Asia, said some fund managers consider sustainability performance as a proxy for good management.

"With a new ESG (Environmental, Social and Governance) index being launched by Bursa Malaysia in 2013, local companies with investments in good sustainability performance have the opportunity to attract additional investment," its Executive Director Rikke Netterstrom said in a statement today.

"A growing number of Malaysian companies are preparing themselves for this by increasing their voluntary disclosure. However, more than 80 per cent run the risk of not being eligible due to lack of robust reporting," he said.

In a survey conducted by CSR Asia on 100 of the largest listed Malaysian companies on sustainability reporting, key results showed that only 18 companies produced a stand-alone sustainability report for 2010-2011.

About 16 of these were produced in accordance with international reporting guidelines from the Global Reporting Initiative (GRI), an increase from the 12 reports produced in 2008-2009.

While half the surveyed companies had detailed information on their sustainability and CSR performance on their respective websites, the other half did not have any substantial sustainability information available, it said.

CSR Asia said Malaysian companies lead Asean countries in the 2011 Asian Sustainability Rating.

Media and telecommunications are the standout sectors, as more than 70 percent of companies in these sectors produce standalone sustainability reports in accordance with the GRI.

Financial institutions are the most improved whereas in 2008-2009, no financial institutions reported, 23 per cent now produce GRI reports.

"It is clear that companies with minimal sustainability reporting capabilities will struggle to attract international investors," Netterstrom said.

Therefore, he said CSR Asia will organise a Disclosure Forum 2012 which will share with sustainability and communications executives, company directors, fund managers and investors insights and best practices on local and global sustainability reporting requirements as laid out by the GRI.

"We will also be sharing the full results of our survey on sustainability reporting," he said.

Disclosure Forum 2012 will be held on Dec 5 at the Kuala Lumpur Golf & Country Club, Bukit Kiara, Kuala Lumpur.