(Yicai) April 15 -- The three bourses in the Chinese mainland have jointly issued guidelines for listed companies to disclose their environmental, social, and governance impact for the first time.

The Shanghai Stock Exchange, Shenzhen Stock Exchange, and Beijing Stock Exchange formulated the Guidelines for Self-Regulation of Listed Companies -- Sustainability Report (Trial) to further implement the requirements of policy papers by the State Council and the China Securities Regulatory Commission to promote listed firms’ high-quality development and investment value enhancement and regulate their disclosure of sustainability information, the three bourses announced on April 12.

Effective May 1, the guidelines include 21 topics divided into three areas: environmental, social, and corporate governance. For the first, listed companies must disclose information about pollutant emissions, waste treatment, and biodiversity protection. For the second, they need to provide materials about technological innovation, data security, and customer privacy protection. And for the third, they have to publish anti-corruption and anti-unfair competition initiatives.

The companies included in the SSE 180 Index, SSE Science and Technology Innovation Board 50 Index, SZSE 100 Index, and ChiNext Index, as well as those listed both in the Chinese mainland and abroad, are required to disclose ESG reports, according to the guidelines. Meanwhile, other listed companies are allowed to publish ESG reports voluntarily.

The guidelines also include a two-year transitional period allowing the listed firms to publish compliant ESG reports, with exemptions from disclosing the year-on-year changes of the indicators in the first reporting period. The companies can also release qualitative information for indicators that are difficult to evaluate quantitatively, but only by explaining why they cannot be quantified.

The guidelines were issued after two months of public opinion solicitation, with over 80 comments. The final guidelines fully incorporate these comments and make important revisions, a person familiar with the rule-making process told Yicai. The first batch of annual sustainability reports by the guideline requirements may come out next year, the person added.

In the next step, the three exchanges will carry out market training under the unified arrangement of the CSRC and develop more detailed disclosure guidelines to provide specific directions for listed companies and support relevant departments to conduct ESG ratings and index product development and investment, Yicai learned.

Editor: Dou Shicong, Futura Costaglione