Page 26 - CMA Journal (Nov-Dec 2025)

Mandatory ESG Reporting in Pakistan: Aligning with
Focus Section

Global Standards for Compliance and Value

Environmental, Social and Governance (ESG) reporting is  Governance (G):
no longer a voluntary requirement or a public-relations Enhancing board
tool. Over the past decade, companies worldwide have supervision,
progressively adopted reporting practices to moral behavior,
demonstrate their effectiveness in managing anti-corruption
Environmental, Social, and Governance (ESG) aspects. initiatives,
What began as a voluntary effort to establish ethical and openness, data
responsible operations has now evolved into a globally security, legal
recognized approach for communicating how compliance and
organizations identify, manage, and disclose their decision-making
sustainability-related impacts, risks and opportunities. accountability

Sustainability and ESG principles offer an organized way 1. Why ESG
to demonstrate how the Company incorporates Reporting &
sustainability into daily operations, risk management and Disclosures Jawad Ahmad, ACMA
strategic planning. By adopting ESG practices and Senior Officer (Strategy & Risk
disclosures, the companies provide regulators, investors Matter Management), Sui Northern
and other stakeholders with a transparent view of how Gas Pipeline Limited (SNGPL)
In recent years,
well they oversee and manage their sustainability
Sustainability and ESG
responsibilities in three key areas:
reporting has emerged as a critical component of
corporate strategy and public account- ability. Several
converging forces have made Sustain- ability and ESG
disclosure essential rather than optional.

1.1 Requirement of Code of Corporate Governance

The Securities and Exchange Commission of Pakistan
(SECP) and the Pakistan Stock Exchange (PSX) have made
it mandatory for the corporate sector of Pakistan to
incorporate sustainability-related reporting and
disclosures in their annual reports. The SECP vide SRO
920(I)/2024, has inserted Regulation 10A effective from
June 2024 for all listed companies. This regulation has
defined the role of the Board of Directors to address
sustainability risks and opportunities. The summary of
this regulation is as under:
 Environmental (E): It deals with the management
Governance and Oversight:
of climate impacts, risks and opportunities,
greenhouse gas emissions, air quality, energy • Responsibility for oversight of sustainability risks and
efficiency, waste and water management, opportunities, which include environmental, social,
biodiversity preservation and adherence to environ- and governance (ESG) considerations.
mental laws.
• Set the sustainability strategies, priorities,
 Social (S): Supporting human rights, community and targets.
involvement, employee welfare, diversity and
inclusion, occupational health and safety, customer • Voluntarily adopt SECP’s ESG Disclosure Guidelines.
responsibility, and socially conscious supply chain
practices.
24 ICMA’s Chartered Management Accountant, Nov-Dec 2025