COMPARATIVE TRENDS OF ESG DISCLOSURE AMONG ASIAN COUNTRIES

Abstract

This study examines the trend analysis of Environmental, Social, and Governance (ESG) disclosure among selected Asian Countries. This study utilises data from Eikon Datastream, and the final sample comprises 2,848 firm-year observations (2015-2023) across Indonesia, Malaysia, Singapore, and Thailand. The results indicate that Indonesia has higher total ESG, social, and governance pillars compared to other countries, except for the environmental pillars. However, the trend shows an increasing pattern for all the selected Asian countries after the COVID-19 outbreak. The recovering trend in ESG after 2019 is mainly attributed to stricter sustainability policies, OJK’s sustainability mandates, the carbon tax introduced in 2019, the launch of Green Plan 2030, the updated reporting guide by Bursa Malaysia, the MCCG reforms in 2017 and 2021, and the standardisation of sustainability reports. This study does not examine the cause-and-effect relationships and overlooks region-specific effects that may influence the level of ESG disclosure. The study contributes to the body of literature, as limited studies have focused on the factors of ESG disclosure. Prior studies have only focused on the relationship of the study. This study has significant practical implications for investors in overseeing the ESG trend in making investment decisions. This study also helps policymakers improve their ESG regulations for enhanced transparency. This study focuses specifically on investigating the factors behind the ESG trends. The increasing trend after 2019 suggests that stricter ESG disclosure mandates can improve ESG transparency.