Online Reporter
ALL listed entities have been called on to submit sustainability reports for financial years commencing on or after 1 January 2024, as mandatory part of their financial disclosures.
Between 2019 and 2020, the Zimbabwe Stock Exchange (ZSE) and the Victoria Falls Stock Exchange (VFEX)’s updated listing rules, which now compel listed companies to put in place measures to deal with environmental, social, and governance (ESG) issues.
The firms were allowed a transitional period for such disclosures.
In a joint statement on Thursday, the Public Accountants and Auditors Board (PAAB), the ZSE and the VFEX said this was in line with the regulatory framework governing listed entities in Zimbabwe.
“This requirement is in accordance with Statutory Instrument 134 of 2019 (Securities and Exchange (Zimbabwe Stock Exchange Listings Requirements) Rules, 2019) and the subsequent ZSE Practice Note 16 and VFEX Practice Note 2.
“Listed entities should prepare and submit their sustainability reports based on section 399 of Statutory Instrument 134 of 2019, ZSE Practice Note 16 and VFEX Practice Note 2. The sustainability reports should ensure transparency, accountability, and the effective communication of sustainability-related information to stakeholders,” read part of the statement.
The statement further read that following Zimbabwe’s adoption of the International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards as issued by the International Sustainability Standards Board (ISSB) in November 2022, listed entities are advised that the implementation of IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information) and IFRS S2 (Climate-related Disclosures) is not mandatory at this stage.
It is said the accountancy regulator, PAAB is currently in the process of developing an implementation roadmap for the Sustainability Disclosure Standards.
“Further guidance will be provided in due course. It is also important to note that while the submission of sustainability reports is mandatory for all listed entities, the assurance of these reports is not currently required. All listed entities are urged to ensure compliance with the above requirements and to engage with relevant regulatory authorities for any necessary clarifications,” read the statement.
In the Zimbabwean context, ESG, or sustainability reporting, is not a new phenomenon, particularly for listed companies that have been obligated to commission such reports.
Whereas the sustainability reporting obligation is prescribed only with respect to listed companies in Zimbabwe, the drive towards ethical and sustainable business has been paramount.
Globally, sustainability reports are enabling addressees and users to understand more clearly the impacts of a company’s business activities on the environment and society and to assess the risks and opportunities companies face, or which are offered to them.
They have become communications tool that plays an important role in convincing sceptical observers that the company’s actions are sincere.
In 2022, out of 43 970 listed companies globally with a total market capitalisation of US$98 trillion, almost 9 600 companies representing a total market capitalisation of US$85 trillion disclosed sustainability‑related information.
The growing urgency in managing climate‑related risks and opportunities has generated greater interest by investors about companies’ greenhouse gas (GHG) emissions.
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