Source: GRI

China’s stock exchanges have played a very important role in advancing corporate social responsibility (CSR) in the country. In 2008, the SSE published a policy encouraging listed companies to issue CSR reports and thereby disclose non-financial, as well as financial, performance information. Since then, there has been a 21 percent increase in the number of CSR reports released by listed companies.

In 2010, the CSR initiatives of the SSE were strengthened, when it launched its CSR Index, showcasing the top 100 companies in terms of social responsibility performance. Now, the SSE capital market research institute has released an analysis report (available in Chinese only) on the sustainability disclosure performance of SSE listed companies.

The report, published last month, shows that 351 companies released CSR reports in 2011 – an increase of seven percent since 2010. 296 of these companies were required to release reports, while 55 disclosed their sustainability performance voluntarily. The SSE 180 Index companies outperformed the other listed companies in both quantity and quality of CSR reports. 69 percent of SSE 180 companies released CSR reports, more than half of which referenced the GRI Guidelines.

Sustainability reporting in China is receiving more recognition and attention than ever before. Between 2001 and 2011, the number of sustainability reports issued in China increased from just two to 1001. This trend is likely to increase even further, and sights are set on improved sustainability disclosure and increased education on corporate governance.

Based on the findings of the report, the SSE has said that it will focus on encouraging more and more companies from different industries to disclose their sustainability performance. In time, the SSE hopes that a unified Chinese CSR reporting framework can be developed – one that can guide different sectors to focus on specific material issues. Until then, it encourages companies to use international frameworks such as the GRI Guidelines to improve the quality of their reports.

Elyse Chen, Research Coordinator at GRI’s Focal Point China, says: “It is encouraging to see stock exchanges like the SSE focusing more attention on regulating the sustainability performance of listed companies. The challenge now is to reach a broader, more localized market in China. In September 2011, GRI launched the Chinese translation of the G3.1 Sustainability Reporting Guidelines. We hope this, along with GRI’s presence in China, will go a long way to aiding the uptake of sustainability reporting initiatives in the country.”

China’s stock exchanges have taken an active role in promoting CSR and the disclosure of sustainability performance by listed companies. As major stock exchanges start paying attention to, and asking for, sustainability data, more are sure to follow suit.