SEC wins third UN sustainability award for Philippines

The Securities and Exchange Commission (SEC) affirmed its world leadership in championing sustainability, as it received for the third time the top honors from the United Nations Conference on Trade and Development (UNCTAD) for promoting sustainability reporting.

During the 41st session of the Intergovernmental Working Group of experts on International Standards of Accounting and Reporting (ISAR) held in Geneva, Switzerland, the SEC received the ISAR Honours 2024 in the national category for empowering small, medium and large enterprises (SMLEs) in reporting their contributions to the fulfillment of national and global sustainable development goals.

The ISAR Honours recognizes policy, institutional or capacity-building initiatives that encourage and assist businesses to publish their contribution to the implementation of the 2030 Agenda for Sustainable Development and facilitating the dissemination of good practices in sustainability.

“It is an honor for the SEC Philippines to receive the prestigious ISAR Honours for the third time, as we have been steadily ramping up our efforts to highlight the importance of sustainability reporting in the corporate sector,” Chairperson Emilio B. Aquino said.

“The corporate sector has a big role to play in ensuring that we achieve the UN Sustainable Development Goals. As a regulator, the SEC is committed to integrating sustainable practices within our organization and in the rules and regulations that we implement, in order to contribute to the overall goal of reducing the impacts of climate change,” he added.

The SEC received the ISAR Honours in 2019 for mandating sustainability and SDG reporting for publicly listed companies (PLCs), and again in 2022 for conducting capacity-building programs to guide them in preparing their annual sustainability reports.

This year, the UNCTAD recognized the Commission for its conduct of the SEC Small and Medium Industries and Large Enterprises Embracing Sustainability (SMILEES) Roadshow, in collaboration with the United Nations Development Programme (UNDP), through Accelerating Green and Climate Finance (ACGF), a project being funded by the Government of Canada.

The SMILEES Roadshow is a multi-year initiative targeting crucial regions in the Philippines with the aim of capacitating and raising awareness among SMLEs on sustainability reporting practices through knowledge sharing, best practice examples, and interactive discussions.

SMEs comprise about 90% of all businesses globally, spanning a wide range of businesses from various industries such as manufacturing, services, and retail, among others, according to a Global Reporting Initiative (GRI) report in 2020. In the Philippines, 99.59% of businesses are from micro, small and medium enterprises according to the 2022 List of Establishments of the Philippine Statistics Authority.

During the roadshows, the SEC encourages SMLEs to measure and report the impacts of their business practices and highlight their sustainability policies to contribute to the country’s overall sustainable development goals.

The initiative further helps the Commission ensure continuous collection of reliable and first-hand data at the local and national levels, and support the reporting of the private sector’s contributions to the SDGs. This will guide the SEC in crafting policy decisions that will drive sustainable development.

To date, the SEC has conducted three SMILEES Roadshows in Cebu, Davao, and Baguio City, with a total of 601 participants. The roadshow’s next stops will include Legazpi, Bacolod/Iloilo, Cagayan de Oro in 2025, as well as Tarlac, Tacloban, and Zamboanga in 2026.

The SMILEES Roadshow is a continuation of the Commission’s efforts to encourage companies to comply with guidelines on sustainability reporting. In 2019, the SEC issued Memorandum Circular No. 4, Series of 2019 (SEC MC No.4), which provides for the Sustainability Reporting Guidelines for PLCs.

To encourage compliance with the Sustainability Reporting Guidelines for PLCs, the SEC conducted capacity-building programs that sought to increase awareness over the importance of measuring sustainable practices. Through these capacity building efforts, the SEC was able to increase compliance
among PLCs to 95% in 2023, from 22%, before the implementation of SEC MC No. 4 in 2019.

Moving forward, the SEC is exploring potential collaborations to support SMLEs in sustainability reporting. This may include developing a standardized reporting template and encouraging reporting on a comply-or-explain basis to ensure the consistent submission of sustainability data.

The SEC also seeks to expand its recently launched Sustainability Enterprise Collaboration Network, or eSECnature, where it aims to unite organizations, both in the public and private sectors, and to develop new ideas, best practices, and promising strategies toward its vision of a sustainable capital market and business sector.

Prior to accepting the ISAR Honours for the year, Chairperson Aquino and Commissioner McJill Bryant T. Fernandez served as panelists for the 41st ISAR session, where they addressed other regulators across the globe and shared the Commission’s best practices in implementing sustainability reporting guidelines.

This is a paid press release from the Securities and Exchange Commission.