In today’s Sunday Times, I read that Burger King cancelled its contract to buy palm oil from Sinar Mas Agro Resources and Technology (SMART). This is said to be a move to protest over Sinar Mas not adopting sustainable farming practices and destroying rainforests in generating the palm oil.
This is a timely reminder of the importance of “Green Reporting”/sustaintability reporting and SGX’s recent issuance of guidelines (ie. non manadatory) on disclosure of social and environmental aspects of business.
Boards and management of companies are slowly and surely being made accountable to all stakeholders. Many years ago, they were said to be only responsible to shareholders for financial results. Now given emphasis on sustainable reporting, management are now being queried on how they achieve those results and the impact they have on the communities within which they operate in.
While I personally hope for such information to be made available on a statutory basis, I am however happy that SGX has taken the first move to “encourage” such reporting.
Bursa Malaysia is ahead of SGX when it legislated (ie. by law) that such reports be made compulsory back in 2007!!! According to ACCA survey as reported by Darryl Wee, CEO of ACCA Singapore, 49 companies in Malaysia generated sustainability reports in eight years. In comparison, Singapore lagged behind with only 21 companies.
P/S – SMART operates all palm oil plantations for Golden Agri Resources, a company listed in Singapore Exchange.