Mandatory sustainability reporting a first step to hold carbon intensive corporations accountable

Communities and green groups today welcomed the announcement of the SEC on mandatory sustainability reporting for publicly listed companies, saying this should now be the first step to hold climate polluting companies accountable for their major contributions to the heating of the planet.

The Philippine Securities and Exchange Commission (SEC) announced on Wednesday that they will begin the process of making sustainability reporting mandatory for publicly listed companies by 2026.1 Before this is implemented, the SEC will continue to operate under a ‘comply or explain’ policy, which allows publicly listed companies to defer disclosing their sustainability and environmental impact if they can provide an explanation.

The announcement comes less than three months after survivors of Super Typhoon Yolanda from Salcedo urged the commission to make sustainability reporting mandatory, as a way to enforce stronger climate accountability policies for corporations.2 Typhoon-impacted communities in Salcedo, Eastern Samar3 and across the country are leading the fight for climate justice and corporate accountability, with many of them participating in collective calls for mechanisms to make polluters pay.

“Bilang magulang at kinatawan ng komunidad namin, masaya ako sa desisyon ng SEC. Pinatutunayan nito na ang pagkakaroon ng tapang kumilos para manawagan ay maaaring magdulot ng mabuting resulta,” said community leader Lorena Ivy Ogania of Salcedo. “Gusto kong tumigil na ang hirap na nararanasan namin dahil sa krisis sa klima, para hindi na maranasan ng aking anak ang mga suliraning kinakaharap natin taon-taon. Sana mapanindigan ng SEC at ng gobyerno ang kanilang tungkulin, at panagutin ang mga kompanyang nagpapalala sa krisis sa klima.”

[“As a parent and representative of my community, I am encouraged by this decision of the SEC. It proves that having courage to take action can result in positive change. I want the hardships we endure because of the climate crisis to end, so my child will no longer experience the problems we are forced to face every year. I hope the SEC and the rest of the government carry out their duty and hold corporations accountable for their contributions to the worsening climate crisis.”]

Requiring disclosure or transparency is an important way to hold companies accountable if their operations or activities contribute to the worsening of the climate crisis. Moreover, the transparency resulting from disclosure will also benefit businesses, as it allows them to address the risks posed by climate change.

“The SEC’s move to make sustainability reporting and climate related financial disclosures mandatory is long delayed but nevertheless a welcome move. But it should only be a first step towards a more stringent regulatory regime for corporate climate accountability,” said Greenpeace campaigner Virginia Benosa-Llorin. “Coupled with the passage of the Climate Accountability Bill (CLIMA Bill), this regulation, if executed well, can potentially allow companies to proactively address climate change and prevent further harm to communities made vulnerable by climate impacts, laying down a framework for corporate transition and accountability.”

Benosa-Llorin, who accompanied Salcedo representatives when they delivered a letter with their demands to the commissioner at the SEC HQ, said that worsening storms, floods, and other weather events caused by escalating climate change is making life unbearable for many Filipinos,” especially at a time when storms are becoming more frequent and unpredictable. It’s causing sleepless nights and severe climate anxiety for residents of previously hit areas. Communities deserve nothing less than having their government on their side.”

[1] Philippines to begin implementing mandatory sustainability reporting by 2026, EcoBusiness.com

[2] “Yolanda survivors to SEC: Strengthen corporate climate accountability” – Community representatives including farmers, fisherfolk, housewives, youth, senior citizens, and other residents of Salcedo, Eastern Samar, hand-delivered a letter to the main offices of the SEC compelling the regulatory body to implement mandatory sustainability reporting and climate related financial disclosures for publicly listed companies.

[3] In 2023, the Municipality of Salcedo, Eastern Samar passed a Municipal Resolution on climate accountability, the very first of its kind in the Philippines.