Applying the IFRS Sustainability Disclosure Standards in Malaysia: A year-one review

One year on from our inaugural study on Malaysia's readiness for the IFRS Sustainability Disclosure Standards, the focus has moved beyond preparation to implementation.  

The first reporting cycle provides valuable insight into how Malaysia’s top 50 listed companies are interpreting and applying the new requirements in practice. It uses an assessment tool which was developed based on the nine key pillars (climate-related metrics; climate-related targets; conceptual framework; data, controls and assurance; general requirements; governance; metrics and targets; risk management; strategy) aligned with the IFRS S1 'General Requirements for Disclosure of Sustainability-related Financial Information' and IFRS S2 'Climate-related Disclosures’, collectively referred to as the International Sustainability Standards Board (ISSB^TM) Standards.

Using a five-level maturity scale from Nascent (1) to Leading (5), our assessment identifies how companies are embedding sustainability considerations into reporting and decision-making. 

The findings point to progress in reporting maturity across a broader range of sectors, with governance as a key strength. The publication also highlights key developments in disclosure practices, the integration of sustainability-related risks into enterprise risk management (ERM) frameworks, cross-industry metrics disclosures under IFRS S2, and the growing practice of limited assurance. ‌

As reporting expectations continue to evolve, organisations are encouraged to identify areas for further enhancement and apply practical insights to strengthen their sustainability reporting journey.