The World Federation of Exchanges called on exchanges Wednesday to embrace a set of 34 environmental, social and governance factors into their disclosure guidance for companies listed in their markets to provide a uniform corporate reporting framework for investors.
The disclosure ESG metrics include the ratio of CEO pay and median pay at a company; ratio of median male pay to median female pay; employee turnover rate; workforce and board gender diversity; injury rate; tax transparency; total metric tons of direct and indirect greenhouse gas emissions; carbon intensity, measuring carbon emissions to total revenue; water management, measuring water used, recycled and reclaimed; and waste management, measuring waste generated, recycled and reclaimed.
Listed companies would benefit, among other ways, by enhancing a company's ability to attract pension funds and other long-term institutional investors and to identify opportunities for cost savings, revenue generation and risk mitigation, a WFE statement said.
The guidelines are the result of a WFE sustainability working group, formed last year and made up of representatives from 22 member exchanges.
“Though there is a lot of work ahead of global exchanges to bring sustainability reporting consistency to the market, the guidance launched by the WFE” will help “unify and strengthen reporting standards across borders,” said Mindy Lubber, president of Ceres, a coalition of asset owners and other institutional investors working on corporate environmental issues, in a separate statement.
The London-based WFE, a global trade association, represents 64 public stock, futures and options exchanges, and central clearing counterparties, including Euronext, Intercontinental Exchange, Nasdaq, TMX Group, Deutsche Borse, CBOE Holdings and CME Group. More than 44,000 companies, representing a combined market capitalization of $64 trillion, list on WFE exchanges, according to the WFE statement.