WSE (Warsaw Stock Exchange), in cooperation with the EBRD (European Bank for Reconstruction and Development), will develop guidelines for reporting ESG factors by listed companies.
The guideline will be developed by an external consultant, the international consultancy firm Steward Redqueen, which was selected following a public inquiry conducted by the EBRD.
According to reports the reason for the guideline preparation is that the stock exchange wants to help companies to adjust their reporting to new requirements. The statements refer both to the increasing requirements from the investor community and to the new non-financial disclosure requirements of the European Union.
The new guideline is also connected to the results of a survey conducted by the WSE in October 2019 among capital market participants on the impact of ESG factors on investment decisions, 88 percent of the respondents decided that companies whose strategy is based on good ESG practices may be treated as entities with a reduced level of risk, and thus with increased investment attractiveness. Well-prepared ESG reports allow for the preparation of an appropriate company strategy in many areas, which is treated by investors as risk reduction.
The document will be created with the involvement of a wide range of stakeholders, including issuers, investors and regulators. The result will be a criteria system that will allow companies to adjust the content of non-financial reports to investors’ expectations.
This new guideline is another sign that a growing number of Central European stock exchanges try to help companies and investors in improving their non-financial reports and to promote ESG in general. Recently the Budapest Stock Exchange has also announced a public consultation on a new ESG guideline draft.
Cover photo: unsplash / Myriam Jessier