Taskforce on Nature-related Financial Disclosures (TNFD) maturity in the Thai Financial Sector EP.1 (2/2)

At a crossroads: Sustainability reporting in Thailand’s financial sector

While sustainability reporting is becoming more prevalent in Thailand, the maturity levels of TCFD and TNFD vary across the corporate landscape and remain largely voluntary. The Securities and Exchange Commission Thailand (SEC) and the Bank of Thailand (BOT) are currently working hard to encourage the private sector to include ESG, climate and nature-related disclosures. For example:

• the Thai SEC launched a public consultation on its five-year roadmap for implementing ISSB standards for Thai-listed companies, aiming to standardise sustainability information disclosures in accordance with IFRS S1 and S2^[4]
• on 20 February 2024, the SEC joined the TNFD forum, indicating the commitment to nature related disclosures^[5] and
• the BOT has issued a policy statement to integrate environmental considerations into financial firms’ operations and strategies, followed by the release of directional papers and industry handbooks for the sector^[6,7].

There is a clear trend in other financial markets in territories outside Thailand, where there’s an increasing shift towards mandatory disclosures. For example, Malaysia^[8], Singapore^[9], Hong Kong SAR^[10], and the European Union (EU)^[11] have implemented reporting regulations that require mandatory climate-related financial disclosures.

TCFD and TNFD maturity in the Thai financial sector

Currently, some 60% of Thai companies actively disclose information in line with TCFD guidelines (See Figure 3)^[12]. This reflects a growing recognition within the business community of the importance of transparent climate-related disclosures.

Figure 3: Comparison by Territory of companies disclosing TCFD

^{Source: Sustainability Counts II. Research focusing on the top 50-listed companies by market capitalisation across 14 selected jurisdictions across the Asia Pacific.}

In 2024, Thai financial firms, particularly banks, made greater commitments to align their climate-related disclosures with TCFD guidelines. Notably, several Thai banks published their first TCFD reports last year^[13,14]. This is most likely a response to the regulator’s expectations for banks to conduct climate risk stress tests and report climate-related information in accordance with the BOT’s guidelines that adhere to TCFD recommendations at least annually^[6]. In line with the SEC’s public consultation on adopting IFRS S1 and S2 standards, more Thai financial firms recognise the significance of the upcoming regulations and are preparing to disclose their climate-related information based on the IFRS S2 standard.

Adoption of the TCFD reporting standards is gaining momentum in Thailand. However, TNFD-aligned reporting remains in its infancy. Currently, only four companies in Thailand have publicly committed to adopting TNFD, with none from the financial sector^[15].

While explicit reporting on TCFD and TNFD is somewhat limited, it’s likely that some elements of the existing sustainability reporting already align with the TCFD and TNFD recommendations. To understand what this means for the Thai financial sector, PwC carried out a maturity assessment on 17 financial firms across four financial sub-sectors: commercial banks, asset management firms, government banks and insurance companies. Collectively, these firms can represent an average snapshot of Thailand’s financial sector.

Our research found that on average, the Thai financial sector shows progress in aligning with TCFD and TNFD recommendations, with asset management firms and commercial banks leading the sub-sectors. However, government banks and insurance companies still have significant progress to make.
 

Please stay tuned for the next episode, where we will share more exciting updates and insights, including the results of the TCFD and TNFD maturity analysis of a selection of the Thai financial services sector.
 

References:
_{[4] The Securities and Exchange Commission, Thailand (2024). Public consultation on ISSB road map.
[5] The Securities and Exchange Commission, Thailand (2024). SEC becomes a member of the TNFD forum.
[6] Bank of Thailand (2023). Policy Statement Internalizing Environmental and Climate Change Aspects into Financial Institution Business.
[7] Bank of Thailand (2023). Industry Handbook Internalizing Environmental and Climate Change Aspects into Financial Institution Business.
[8] Securities Commission Malaysia (2024). National Sustainability Reporting Framework.
[9] Singapore Exchange Limited (2024). Roadmap for Mandatory Climate Reporting (FYC 2025 and 2026).
[10] The Stock Exchange of Hong Kong Limited (2024). Conclusions on Climate Disclosure Requirements.
[11] The European Commission (2023). the European Sustainability Reporting Standards.
[12] PwC Asia Pacific (2025). PwC Sustainability Counts III.
[13] TMB Thanachart Bank (2024). TCFD report 2023.
[14] Government Savings Bank (2024). GSB climate report 2023.
[15] TCFD (2024). TNFD Adopters.}

Authors:

Chayathorn Chanruangvanich
Partner, Sustainability Advisory Services, PwC Thailand

Perpetua George
Director, Asia Pacific Sustainability, Nature & Biodiversity, PwC Malaysia