Page 24 - CMA Journal (May-June 2025)

Focus Section

4.1 Establishment of ESG Reporting and Regulatory
Body - There is a strong need to establish a
centralized ESG regulatory body under the umbrella
of the Securities and Exchange Commission of
Pakistan (SECP) to implement ESG disclosure
requirements across key sectors of the economy. This
body should regulate mandatory ESG-based annual
sustainability reports in line with SASB and GRI
reporting frameworks, with a particular focus on
enforcing compliance among export-oriented firms
(Khan et al., 2023).
4.2 ESG Investments and Certifications - To promote
green tax relief and facilitate ESG adoption,
subsidized ESG certifications—such as international
standards for Environmental Management (ISO
article—from declining export orders to outright buyer
14001) and Social Accountability (SA8000)—should
refusals—demonstrates that non-compliance with ESG
be introduced. Preferential financing must be
standards is no longer a minor issue, but a significant
initiated under Export-Import Bank (EXIM Bank) or
strategic economic risk.
State Bank of Pakistan (SBP) schemes. Special rebates
should be offered to exporters who fully comply with Research on countries such as South Korea and Vietnam
ESG reporting requirements, especially under export shows that active ESG implementation is strongly
trade agreements. associated with improved export performance, increased
investment flows, and greater market penetration.
4.3 Magnitudes & Structure for SMEs and Exporters -
Conversely, failure to comply with global ESG standards
To improve ESG awareness and understanding,
can lead to trade sanctions and reputational damage,
particularly among small and medium enterprises
particularly in high-growth sectors such as leather,
(SMEs), sector-specific training programs should be
textiles, and agriculture.
launched in collaboration with the Trade
Development Authority of Pakistan (TDAP) and the A multi-stakeholder, policy-driven strategy is essential to
Small and Medium Enterprises Development regain lost momentum. Key actions include
Authority (SMEDA), sponsored by chambers of strengthening the legal and regulatory environment,
commerce and industry. A proper digital platform enhancing professional literacy on ESG through
should also be developed to facilitate institutions like ICMA Pakistan, promoting green
self-assessment and performance tracking. investment, and building the capacity of SMEs. Likewise,
international recognition and strategic positioning can
4.4 Role of ICMA Pakistan in Sponsoring ESG Mastery
be achieved through the full implementation of ESG
- In collaboration with SECP, ICMA Pakistan can play a
standards, backed by committed assurance in line with
key role in integrating the ESG framework into
national strategies such as Vision 2025 and global
professional accounting and finance education. This
frameworks like the Sustainable Development Goals
will help exporters build a cadre of ESG-literate
(SDGs).
professionals who can guide industry compliance.
Pakistan must begin to view ESG not as a compliance
4.5 Aligning ESG with Vision 2025 and SDGs - To
burden, but as a strategic tool for sustainable trade and
ensure long-term sustainability, the ESG framework
industrial transformation. By fully embracing ESG
must be aligned with Pakistan’s Vision 2025, which
initiatives, the country can improve its brand image,
prioritizes export growth, green resources, green
enter diversified global markets, and position itself as a
governance, and structural reforms.
responsible and competitive export-driven economy.
5. Conclusion and Future Outlook About the Author: The Author is a Fellow Member of ICMA and
serves as a Senior Instructor at Government College of Commerce,
Pakistan’s export sector is at a turning point. Due to
Multan. With over 20 years of experience in management
fragmented policies, a lack of understanding, and poor
accounting, corporate finance, and business taxation, he has taught
implementation, the country continues to lag behind at various public and private sector universities and professional
multinational competitors that have adopted ESG institutes in Pakistan. He previously worked as Assistant Manager
principles as a benchmark for reliability and Accounts at Orient Group of Companies. Currently, he is a faculty
competitiveness. The evidence presented in this member at ICMA Pakistan's Multan campus and is pursuing a PhD.
22 ICMA’s Chartered Management Accountant, May-June 2025