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ESG Disclosures Surge 40% Post-IPO
9 Sep
Summary
- ESG disclosures rose 40% after companies listed, despite not being mandatory.
- ESG scores increased by an average of 50% for companies before their IPO.
- Textile industry showed a 9% rise in ESG transparency in FY21.
Average environmental, social, and governance (ESG) disclosures from companies increased by 40% after their IPOs and subsequent listings. This rise occurred despite current regulations not mandating such disclosures. Concurrently, companies saw an average 50% uplift in their ESG scores from 2018 up to their listing date, underscoring the value placed on transparent ESG journeys.
Sectors like textiles experienced notable improvements, with the industry's transparency score climbing 9% in FY21. IT services and paper products followed with a 7% increase. Conversely, civil engineering and automobile sectors saw declines in their transparency scores. These shifts suggest a varied adoption of ESG principles across different industries.
Despite not being mandatory, ESG reporting is set to become compulsory for the top 1,000 listed firms from FY23. This upcoming regulation is expected to further drive corporate accountability. Companies, particularly those in polluting industries, are increasingly recognizing responsible resource management and stakeholder fairness as critical for long-term success, as noted by industry experts.
