Evaluating Malaysia’s readiness for the​ IFRS Sustainability Disclosure Standards​

Momentum observed with gaps
Malaysia’s top 50 listed companies show encouraging progress, with overall market readiness rated as ‘Developing.’ Companies are laying solid foundations, particularly in governance including board oversight and climate narratives. However, disclosure consistency, connectivity, and how reporting practices deliver value to decision-making remain uneven across the nine pillars. ​

Higher readiness levels observed in the financial services sector
Bank Negara Malaysia's mandatory requirements on Task Force on Climate-Related Financial Disclosures (TCFD)-aligned disclosures and supporting frameworks are among the key factors leading to higher maturity levels in the financial services sector. ​

Better disclosure quality and integration needed​
Companies need to provide quantified, comparable metrics supported by clear targets and baselines. Strengthening governance and internal controls is essential to ensure data reliability and prepare for assurance. Sustainability should be embedded into risk management, strategy, and financial planning, creating stronger alignment with the requirements of the ISSB Standards. ​

A greater push for capacity building and early stakeholder engagement ​
To meet growing stakeholder expectations for transparent reporting, businesses must strengthen data quality and invest in reporting systems and skilled teams. Advancing scenario analysis and transition planning will help organisations make informed, strategic decisions. Engaging management, shareholders and other stakeholders early will ensure alignment. ​