As global sustainability efforts gain momentum, the role of accountants in Environmental, Social, and Governance (ESG) reporting has expanded significantly. In Singapore, where corporate responsibility and transparency are central to economic growth, ESG and climate-related disclosures have become key compliance requirements. The Sustainability Reporting Advisory Committee (SRAC) and regulatory frameworks such as the Singapore Exchange (SGX) Sustainability Reporting Rules emphasize the need for standardized, auditable, and actionable ESG reporting.

In this article, we examine how Singaporean accountants are uniquely positioned to guide companies through ESG reporting complexities while ensuring legal compliance and fostering sustainable business practices.

1. The Regulatory Landscape: Compliance and Strategic Integration

Singapore has developed a robust ESG regulatory framework that aligns with global best practices while addressing regional sustainability challenges. Accountants must remain well-informed of these evolving requirements to ensure their clients are compliant and leverage ESG reporting as a strategic advantage.

Singapore Exchange (SGX) Sustainability Reporting Rules

Singapore Exchange Regulation (SGX RegCo) has strengthened its sustainability reporting framework by incorporating the IFRS Sustainability Disclosure Standards into mandatory climate reporting requirements. Beginning with the financial year (FY) 2025, all listed companies must report Scope 1 and Scope 2 greenhouse gas (GHG) emissions, with climate-related disclosures aligned with IFRS Sustainability Disclosure Standards issued by the International Sustainability Standards Board (ISSB).

This regulatory enhancement builds on the Task Force on Climate-related Financial Disclosures (TCFD) recommendations, which SGX RegCo has gradually implemented since FY 2022. The transition to mandatory climate-related reporting for all issuers reflects growing regulatory alignment with global ESG standards.

• Climate reporting is mandatory from FY 2025, incorporating IFRS-aligned disclosures except for Scope 3 GHG emissions, which remain under review.
• Issuers must integrate sustainability disclosures into their annual reports by FY 2026, except where external assurance is conducted, allowing for an extended submission deadline of up to five months after the financial year-end.
• SGX RegCo will review issuer readiness before implementing Scope 3 GHG emissions reporting, prioritizing large issuers by market capitalization from FY 2026.
• Independent assurance of ESG data is encouraged to enhance the credibility of sustainability disclosures and investor confidence.

These changes mark a pivotal step in aligning Singapore’s corporate sustainability reporting with global best practices, enhancing transparency and accountability while enabling companies to manage climate risks and seize opportunities in the transition to a low-carbon economy.

Task Force on Climate-related Financial Disclosures (TCFD)

While TCFD guidelines are not yet mandatory in Singapore, they are increasingly adopted by corporations seeking to strengthen their climate-risk reporting. Accountants help businesses implement TCFD-aligned climate risk assessments, ensuring accurate financial representation of sustainability risks and opportunities.

• Key pillars of TCFD include governance, strategy, risk management, and metrics & targets.
• Companies must disclose how climate risks impact long-term financial performance.
• Scenario analysis methodologies are used to assess climate change’s potential financial effects.

Green Finance Action Plan & Environmental Risk Management Guidelines

The Monetary Authority of Singapore (MAS) has introduced stringent Environmental Risk Management (ERM) Guidelines for financial institutions. Accountants supporting banks, insurers, and asset managers must navigate these guidelines to enhance ESG integration into financial risk assessments and investment strategies.

• Financial institutions must integrate climate risk considerations into lending and investment decisions.
• Stress testing and risk scenario modelling are required to evaluate environmental exposure.
• Transparency in sustainable finance activities is enforced to align with Green Finance Taxonomy.

International Sustainability Standards Board (ISSB) Alignment

With Singapore supporting the ISSB sustainability disclosure standards, accountants must prepare businesses for compliance with emerging global ESG norms, ensuring alignment with the evolving corporate sustainability landscape.

• ISSB standards aim to harmonize sustainability reporting globally.
• Industry-specific disclosure standards help refine ESG data accuracy.
• The Singapore government is working towards mandatory sustainability reporting for large corporations.

2. Key Accounting Bodies and ESG Guidance in Singapore

Singaporean accounting and regulatory bodies are actively shaping the country’s ESG reporting ecosystem, providing essential frameworks and support.

Institute of Singapore Chartered Accountants (ISCA)

The ISCA Sustainability and Climate Change Committee provides guidance on ESG disclosures, helping accountants integrate sustainability reporting into financial statements while ensuring compliance with global standards.

• ISCA promotes the use of integrated reporting frameworks for better financial-ESG alignment.
• The organization has introduced training programs for accountants to enhance ESG expertise.
• Industry case studies are developed to provide practical insights into ESG implementation.

Accounting and Corporate Regulatory Authority (ACRA)

ACRA has reinforced ESG reporting as a corporate governance priority, advocating for structured disclosures that align with Sustainability Accounting Standards Board (SASB) guidelines and Global Reporting Initiative (GRI) frameworks.

• ACRA requires directors and auditors to incorporate ESG risks into risk assessment processes.
• Encourages companies to integrate ESG disclosures into corporate governance reports.
• Promotes the standardization of non-financial reporting indicators.

3. The Expanding Role of Accountants in ESG Reporting

With ESG disclosures becoming a corporate imperative, accountants in Singapore are taking on a broader role beyond financial compliance:

1. ESG Assurance and Verification

Singapore’s move toward mandatory assurance of ESG reports requires accountants to develop new auditing frameworks, ensuring sustainability data is reliable and free from material misstatements.

• Third-party limited and reasonable assurance of ESG disclosures is gaining traction.
• Accountants must verify green financing transactions and sustainability-linked bonds.
• Ensuring data integrity in carbon emissions reporting is a growing responsibility.

2. Strategic ESG Advisory

Beyond compliance, accountants now offer strategic ESG guidance, advising firms on embedding sustainability into their business models to enhance long-term financial and environmental resilience.

• ESG advisory services include carbon footprint reduction strategies and sustainability-linked tax planning.
• Accountants must assess supply chain sustainability risks and compliance with ESG procurement policies.
• Developing climate risk mitigation roadmaps enhances resilience for businesses operating in high-risk sectors.

3. Climate Risk Integration into Financial Reporting

With climate-related risks increasingly impacting corporate performance, accountants must quantify these risks in financial statements, aligning reporting practices with TCFD and ISSB standards.

• Asset impairment assessments now include climate-related risks.
• Accountants play a role in determining capital allocation strategies for sustainability initiatives.
• Valuation models are evolving to incorporate biodiversity and natural capital risks.

4. Challenges and Solutions in ESG Reporting

Despite advancements, Singaporean companies and their accountants face several ESG reporting challenges:

1. Data Collection and Standardization

Many firms struggle with inconsistent ESG data across operations. Accountants must implement robust data management systems to improve reporting accuracy and comparability.

• Advanced ESG data analytics platforms streamline reporting processes.
• Implementation of blockchain solutions for carbon credit tracking is gaining traction.

2. Evolving Regulatory Frameworks
With frequent updates to SGX, ISSB, and MAS guidelines, accountants must stay ahead of regulatory changes, ensuring proactive compliance for their clients.

• Firms investing in ESG training programs for accounting teams are at a competitive advantage.

Table: Key ESG Reporting Frameworks in Singapore

 5. The Future of ESG Reporting in Singapore

As Singapore continues strengthening its green finance ecosystem, accountants will play an increasingly strategic role in shaping the sustainability landscape. The future of ESG reporting will be characterized by:

• Greater assurance requirements for sustainability reports.
• Integration of AI-driven ESG analytics to enhance data accuracy.
• Expansion of carbon accounting methodologies to align with Singapore’s Net-Zero 2050 goals.

6. Conclusion

Singapore’s ESG reporting framework is evolving rapidly, making accountants pivotal in ensuring businesses remain compliant, transparent, and sustainable. By integrating ESG disclosures into financial reporting, accountants are driving corporate sustainability and long-term economic resilience. In an era where sustainability defines corporate success, Singapore’s accountants are at the forefront of shaping a greener financial future.

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