Page 25 - CMA Journal (May-June 2025)

Embedding ESG at the
Focus Section

Board Level for Corporate

Sustainability in Pakistan

Introduction ESG Practices in
Pakistan: Survey
Sustainability and ESG, once considered buzzwords, are
now being seriously acknowledged by both corporates Findings
and policymakers. Many still debate the difference
As per the PICG ESG
between the two. Technically speaking, sustainability has
survey conducted in
a broader scope, while ESG can be seen as a subset of
2023:
sustainability. ESG stands for Environmental, Social, and
Governance, which together cover a wide range of areas In response to the
within which a business operates. Generally, both terms
question, “Does your
are used interchangeably.
organization have a
With growing awareness, value chains are increasingly defined action plan Muhammad Junaid
inquiring about the ESG practices of their business related to the ESG Shekha, FCMA, FCA
partners, making a strong business case for strategy?” the results
Head of Internal Audit
implementation. Recognizing this importance, were as follows:
Yunus Textile Mills Limited
regulators have taken appropriate steps by introducing
• Yes – 30% (Part of YBG)
regulations and mandatory compliance related to
sustainability. One key requirement for corporations is • No – 20%
the establishment of a sustainability and ESG policy.
• Not sure – 10%
The Securities and Exchange Commission of Pakistan
• In progress – 40%
(SECP), the primary regulator of companies in Pakistan,
has introduced several changes in the regulatory These findings make a strong case for companies to
framework related to sustainability—particularly adopt a board-level ESG policy to steer and accelerate the
through the Code of Corporate Governance for Listed ESG agenda.
Companies, 2019 (the Code)—which requires a
company’s Board of Directors to establish and maintain Having an ESG policy at the board level is also important
an ESG policy. from a governance perspective, as it ensures ownership
and clarity at the highest level. This facilitates smoother
integration of ESG priorities across the organization,
helping to achieve defined objectives.
The Code requires companies to have a policy addressing
the following:
“Environmental, Social and Governance (ESG), including
but not limited to health and safety aspects in business
strategies that promote sustainability, corporate social
responsibility initiatives and other philanthropic activities,
donations, contributions to charities, and other matters of
social welfare.”

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