Changes to Singapore's Climate Sustainability Reporting
Singapore’s skyline
Content guide:
Overview of NEW sustainability and climate reporting in Singapore.
Climate reporting in Singapore to spur the green transition.
What companies are impacted by the new climate regulations in Singapore?
Key requirements of climate reports.
Greenhouse gas emissions reporting
External assurance
Parent company exemptions
Singapore government support
To summarise, the key requirements are
Preparing your climate and sustainability report.
Conduct a materiality assessment
Choose a reporting framework
Collect and analyse data
Copywriting your climate and sustainability report
Assurance (optional)
Unsure of how to begin your sustainability journey
Partner with the UN Global Compact Network Singapore (GCNS)
Overview of NEW sustainability and climate reporting in Singapore.
From FY2025, all listed companies in Singapore will be required to report and file annual climate-related disclosures (CRD) aligned with the International Sustainability Standards Board (ISSB) standards.
Two years later, in FY2027, large non-listed companies (defined as those with at least $1 billion in annual revenue and $500 million in total assets) will also be mandated to disclose this information.
Climate reporting in Singapore to spur the green transition.
Companies to report on climate risks and emissions is meant to help businesses strengthen their sustainability capabilities and benefit from new opportunities arising from the green transition. By providing CRD, companies could gain access to new markets, customers, and financing. The Singapore government aims to support companies in developing climate reporting expertise through initiatives from the Ministry of Trade and Industry.
Requiring companies to report on climate risks and emissions is meant to help businesses strengthen their sustainability capabilities, benefit from new opportunities arising from the green transition, and contribute to Singapore's overall transition to a low-carbon economy.
By providing climate-related disclosures, companies could gain access to new markets, customers, and financing as investors and customers increasingly demand transparency on environmental performance. The disclosures may also help companies identify physical and transition risks related to climate change, inform strategies to mitigate those risks and capture opportunities from the shift to a greener economy.
The Singapore government aims to support companies in developing climate reporting expertise, which includes guidance documents, educational workshops, and consultations with industry experts. The government may also provide grants and incentive programs to help companies implement sustainability reporting systems and hire specialised consultants or staff.
Overall, the reporting requirements are a positive step that drives business innovation, competitiveness, and long-term value creation by focusing on environmental sustainability.
Phased implementation for climate reporting in Singapore.
The timeline for mandatory CRD implementation will be phased in, giving companies adequate time to build capabilities.
Listed companies will report on Scope 1 and 2 emissions starting in FY2025 and on Scope 3 emissions the following year.
Large non-listed companies will begin disclosing Scope 1 and 2 emissions in FY2027 and Scope 3 emissions no earlier than FY2029.
Overall, the new sustainability reporting regulations demonstrate Singapore’s commitment to environmental responsibility and make the city-state a leader in sustainable business. By mandating climate disclosures, companies will gain the insights needed to navigate risks and tap into opportunities in the transition to a greener economy.
What companies are impacted by the new climate regulations in Singapore?
The new regulations will impact all SGX-listed companies, requiring them to report climate-related disclosures from FY2025. This includes scope 1 and 2 greenhouse gas emissions, with scope 3 emissions reporting to commence from FY2026. External limited assurance of scope 1 and 2 emissions will be mandated from FY2027.
Large non-listed companies in Singapore, defined as those with at least $1 billion in annual revenue and $500 million in total assets, will also be subject to the requirements. They must report scope 1 and 2 emissions from FY2027, scope 3 emissions no earlier than FY2029, and obtain external assurance of scope 1 and 2 emissions from FY2029.
Some exemptions will be granted to large non-listed companies whose parent companies already report climate-related disclosures. Those whose parents report under International Sustainability Standards Board (ISSB) standards or equivalent will be exempted, provided certain conditions are met. Those whose parents report under other international frameworks like the Global Reporting Initiative will receive a three-year transitional exemption until FY2029, after which ACRA will review whether to extend it.
The new regulations aim to help companies access new markets, customers and financing by demonstrating their sustainability credentials. They will also support companies in strengthening their climate-related capabilities to benefit from the growing green economy. With the momentum towards environmental responsibility intensifying globally, mandatory climate-related disclosures are a crucial step for Singapore to encourage companies to address climate change.
The regulations will impact over 1,300 SGX-listed and large non-listed companies, contributing to greater transparency on climate-related risks and opportunities.
Critical requirements of climate reports.
Companies must provide detailed sustainability disclosures in their annual reports to comply with the new regulations.
Greenhouse gas emissions reporting:
From FY2025, you must report your Scope 1 and 2 greenhouse gas emissions.
Scope 1 covers direct emissions from company operations, while Scope 2 covers indirect emissions from purchased electricity. In FY2026, you must report Scope 3 emissions from your supply chain and product use.
Provide historical emissions data to show your progress in reducing emissions over time.
External assurance:
Limited external assurance on your Scope 1 and 2 emissions disclosures will be mandatory from FY2027. Work with an accredited external assurer to verify your emissions data and calculations. External assurance boosts the credibility and reliability of your disclosures for investors and stakeholders.
Parent company exemptions:
If your parent company already provides sustainability disclosures aligned with ISSB standards or equivalent, you may be exempted from filing separate reports with ACRA, subject to certain conditions. However, you must still gather and track your own emissions data internally.
ACRA will review exemptions in FY2029 to determine if the transitional period should be extended.
Singapore government support:
The Singapore government will support companies in building capabilities in sustainability reporting. Use these resources to strengthen your data collection processes, identify emissions reduction opportunities, and enhance your disclosures. Robust sustainability practices and transparent disclosures will position your company to seize new opportunities in a green economy.
To summarise, the essential requirements are:
Report Scope 1 and 2 emissions from FY2025 and Scope 3 from FY2026 onwards.
Obtain limited external assurance on Scope 1 and 2 emissions disclosures from FY2027.
Strengthen sustainability capabilities by utilising government resources and developing robust data collection processes.
While parent company exemptions provide temporary relief, all companies should start preparing to meet these requirements to promote environmental responsibility and sustainable business practices.
Preparing your climate and sustainability report.
The mandatory climate reporting requirements in Singapore aim to enhance transparency and strengthen companies’ capabilities in sustainability reporting. Your company should take several steps to prepare for the upcoming changes.
Conduct a materiality assessment:
A materiality assessment helps determine which environmental, social and governance (ESG) factors are most important to your business and stakeholders. Analyse how climate change impacts your operations and value chain. Identify key metrics to track, such as greenhouse gas emissions, water usage and waste. Focus your report on the issues that matter most.
Choose a reporting framework:
Decide if you will report using the ISSB standards or an alternative framework like the Global Reporting Initiative. The ISSB standards are aligned with the recommendations from the Task Force on Climate-related Financial Disclosures, which many investors support. However, other frameworks may better suit your industry or business model.
Collect and analyse data:
Gather quantitative data on your key metrics and ESG factors. Analyse trends to identify risks and opportunities. Set targets and key performance indicators to track your progress over time. Your data and analysis will form the basis of your report.
Copywriting your climate and sustainability report:
Describe your key ESG factors, metrics, targets, and performance. Discuss how you are addressing risks and opportunities related to climate change. Share case studies and examples to demonstrate your key points. Your report should be comprehensive yet concise, balancing transparency with readability.
Need help copywriting your climate and sustainability report?
Reach out to Kyyte, your go-to partner for sustainability copywriting solutions.
Assurance (optional):
Independent assurance provides credibility for your report. Limited assurance verifies your data and claims are plausible, while reasonable assurance offers higher confidence. Assurance is required from FY2027 for Scope 1 and 2 emissions of listed companies and large private companies.
Following these steps will help your company publish an informative sustainability report that meets Singapore’s new reporting requirements. Mandatory climate disclosures aim to drive improved transparency and environmental responsibility among businesses. By preparing thoroughly for these changes, your company can gain a competitive advantage through enhanced credibility and access to sustainable capital.
Unsure of how to begin your sustainability journey?
Partner with the UN Global Compact Network Singapore (GCNS).
The UN Global Compact Network Singapore (GCNS) is the local chapter of the world's largest corporate sustainability initiative, the UN Global Compact. GCNS offers a wealth of resources and support to help companies on their sustainability journey, including:
Training and events: GCNS regularly organises workshops, seminars, and conferences led by industry experts, keeping members informed and equipped with the latest sustainability knowledge.
Networking opportunities: Connecting with other like-minded businesses through GCNS events fosters collaboration, knowledge sharing, and collective action towards achieving sustainability goals.
Expert guidance: GCNS provides access to a network of sustainability experts who can offer tailored advice and support specific to your company's needs.
By leveraging these resources and collaborating with organisations like GCNS, companies can ensure a smooth transition, enhance their sustainability performance, and position themselves as leaders in the evolving sustainability landscape. Remember, embracing the change isn't just about compliance; it's about unlocking new opportunities, mitigating risks, and contributing to a more sustainable future.
Kyyte, where sustainability takes creative flight.
Kyyte is a B2B copywriting and content marketing agency in Singapore with an added focus on sustainability. While we're not a listed company in Singapore and don't meet the turnover for mandatory sustainability reporting, we're committed to becoming a sustainable marketing agency.
As a proud GCNS member company (see our commitment letter to the UN Secretary-General), we're excited to produce our first Communication on Progress (COP) report later this year. It will outline how we've integrated the UN Global Compact's Ten Principles into our strategies, operations and contributions to societal priorities.
FAQs on climate and sustainability reporting in Singapore.
What does mandatory climate reporting in Singapore entail?
The mandatory climate reporting requirements will require all Singapore Exchange (SGX) listed and large non-listed companies to disclose climate-related risks and opportunities. Specifically, companies must report Scope 1 and 2 greenhouse gas (GHG) emissions from FY2025, with Scope 3 emissions reporting required from FY2026 for listed companies and no earlier than FY2029 for large non-listed companies. External assurance of Scope 1 and 2 emissions will be mandatory from FY2027 and FY2029, respectively.
What are the benefits of climate reporting?
Mandatory climate reporting aims to help companies gain better insights into climate-related risks and opportunities. Disclosing climate impacts and strategies can help companies access sustainable financing and meet customer demand for environmentally friendly products and services. It also allows investors and stakeholders to make better-informed decisions. Studies show that companies that report on sustainability tend to outperform their non-reporting peers.
What standards will companies use for climate reports?
Companies must report using standards aligned with those set by the International Sustainability Standards Board (ISSB). The ISSB is an independent standard-setting body established by the IFRS Foundation to develop global sustainability disclosure standards. Some companies report using other international standards, such as the Global Reporting Initiative (GRI) standards. Subject to certain conditions, these companies may be exempted from reporting to ACRA for a transitional period.
What support will be provided for Singapore businesses?
The Singapore government will provide support to help companies build climate reporting capabilities. The Ministry of Trade and Industry (MTI) will announce more details on the support measures. ACRA and SGX RegCo will also provide implementation guidance to help companies adopt the ISSB standards. Companies should start preparing by assessing their data gaps and processes required to comply with the mandatory requirements.
When will the requirements for climate reporting in Singapore take effect?
The mandatory climate reporting requirements will be implemented in phases. SGX-listed companies will be required to report from FY2025, while large non-listed companies will report from FY2027. More time will be given for Scope 3 emissions reporting and external assurance. The timeline for implementation is summarised in the timeline table. ACRA will review the experience of early reporters before mandating other companies.
What are Scope 1 emissions?
Scope 1 emissions are direct greenhouse gas (GHG) emissions from sources owned or controlled by the company. These emissions occur from sources that are directly managed by the company and include, but are not limited to:
Emissions from combustion in owned or controlled boilers, furnaces, vehicles, etc.
Emissions from chemical production in owned or controlled process equipment.
Direct emissions from company facilities or vehicles.
Essentially, Scope 1 covers all direct emissions from the activities of an organisation or under its control, making it the most immediate scope a company can manage and mitigate directly.
What are Scope 2 emissions?
Scope 2 emissions are indirect GHG emissions associated with purchasing electricity, steam, heat, or cooling. Although these emissions occur at the facility where the energy is generated, they are accounted for in a company’s greenhouse gas inventory because its operations consume the energy. Key points about Scope 2 emissions include:
They are indirect emissions resulting from the energy the company buys and uses.
Scope 2 emissions account for the energy production process's carbon footprint, transferring that footprint to the end-user, the company in this case.
This categorisation helps companies assess their carbon footprint from energy consumption and explore ways to reduce it through energy efficiency measures or switching to renewable energy sources.
What are Scope 3 emissions?
Scope 3 emissions are the result of activities from assets not owned or controlled by the reporting company but that the company indirectly impacts in its value chain. Scope 3 emissions are the most complex to calculate and often represent the largest source of a company’s greenhouse gas emissions. They include:
Upstream activities include extracting and producing purchased materials, transporting purchased fuels, and employee travel and commuting.
Downstream activities include selling products and services, end-of-life treatment of sold products, and investments.
Scope 3 emissions provide a comprehensive view of the GHG impact across a company's value chain, from the procurement of raw materials to the end use of its products. Addressing Scope 3 emissions can significantly contribute to a company’s climate impact mitigation strategy.
How can companies reduce their greenhouse gas emissions?
Companies can adopt various strategies to reduce their GHG emissions, including:
Improving energy efficiency: Implementing energy-saving measures in operations, buildings, and transportation.
Switching to renewable energy: Purchasing or directly investing in renewable energy sources, such as solar or wind power, to replace fossil fuel-based electricity.
Optimising supply chain: Working with suppliers to reduce emissions upstream and encouraging more sustainable practices across the value chain.
Innovating product design: Designing more energy-efficient products that have a longer lifespan or can be recycled or reused.
Carbon offsetting: Investing in environmental projects that reduce emissions elsewhere, such as reforestation projects, to offset the company's emissions.
What challenges do companies face in reporting greenhouse gas emissions?
Challenges include:
Data collection and quality: Gathering accurate and comprehensive data across all emissions scopes, especially Scope 3, can be complex and resource-intensive.
Standardisation: Applying and adhering to standardised reporting frameworks and methodologies consistently.
Keeping up with regulations: Navigating and complying with evolving regulatory requirements across different jurisdictions.
Stakeholder engagement: Engaging suppliers and customers in sustainability efforts to report and reduce Scope 3 emissions accurately.
Conclusion.
As Singapore moves to mandate climate risk disclosures for listed companies by 2025, aligning with major markets like the EU, your organisation must now prepare to meet higher sustainability reporting standards. Though adapting to expanded ESG regulations may seem challenging initially, view this as an opportunity to thoroughly evaluate and improve your climate policies, data collection processes and disclosure procedures. Embrace transparency as a path toward building resilience, public trust and competitive advantage in a carbon-constrained world.
The mandatory reporting requirements will likely entail disclosing Scope 1, 2 and 3 emissions, climate risks, and mitigation strategies. Your company should start by:
Conducting a greenhouse gas emissions inventory to determine your Scope 1, 2 and 3 emissions baseline. Prioritise calculating direct emissions sources first and work up to indirect emissions.
Establishing targets and reduction initiatives for high-emission sources across your value chain. Consider energy efficiency upgrades, switching to renewable energy, and engaging suppliers to reduce upstream emissions.
Implementing systems to track emissions data and key performance indicators over time. Collect activity data from facilities, operations and suppliers to calculate emissions on an ongoing basis.
Preparing a sustainability report aligned with relevant standards like the GRI and TCFD to disclose your climate impact, risks, and governance. The report should transparently discuss performance, goals, and strategies.
Focus on the foundational elements above to get an early start on climate risk reporting. The regulatory landscape is evolving rapidly; lead in your industry and gain strategic advantages by improving your sustainability management and disclosure now.
Remember, once you have produced your climate and sustainability report, turn it into content and share how you are improving.
