Sustainability reporting in Malaysia: who must report, when, and what it means for smaller companies

Malaysia now has a national rulebook for sustainability reporting. It started with the largest listed companies in 2025 and reaches smaller listed companies and the biggest private companies in 2027. If your company is not on that list, the rules may still reach you through your customers. Here is what regulators have confirmed as of October 2026. What the framework is The National Sustainability Reporting Framework (NSRF) was launched in September 2024 by the Advisory Committee on Sustainability Reporting (ACSR), an inter-agency committee chaired by the Securities Commission Malaysia. Its members include Bank Negara Malaysia, Bursa Malaysia and the Companies Commission of Malaysia (SSM). The framework adopts two international standards, IFRS S1 (general sustainability disclosures) and IFRS S2 (climate-related disclosures). It takes a "climate-first" approach: companies can start with climate disclosures and add the rest later. Who must report, and from when The NSRF applies in three groups, for annual reporting periods beginning on or after 1 January of the year shown: - Group 1, from 2025: Main Market listed companies with market capitalisation of RM2 billion and above. - Group 2, from 2026: all other Main Market listed companies. - Group 3, from 2027: ACE Market listed companies, and large non-listed companies. A non-listed company counts as "large" if its consolidated group revenue was RM2 billion or more for two consecutive financial years before the current one. If there is no group, the test applies to the company itself. There is some relief for subsidiaries. A large non-listed company whose holding company already reports under ISSB-aligned or equivalent standards may rely on the holding company's disclosures. Where the holding company uses other frameworks, such as GRI, the company may be exempted for three reporting periods, subject to the Registrar's decision, and must then use the ISSB standards from 2030. Transition reliefs Companies do not have to report everything in year one. - Climate only at first: Groups 1 and 2 may limit disclosures to climate-related matters for their first two reporting periods; Group 3 gets three. - Scope 3 emissions later: emissions from the value chain (suppliers and customers) become mandatory in 2027 for Group 1, 2028 for Group 2 and 2030 for Group 3. - Principal business segments: climate disclosures can focus on the segments that drive most of the revenue and profit. One relief was not adopted. The sustainability report must be published together with the financial statements, not after them. When assurance starts In September 2026 the ACSR pushed back mandatory reasonable assurance on Scope 1 and Scope 2 greenhouse gas emissions by one year. It now applies to annual reporting periods beginning on or after: - 1 January 2028 for Group 1 - 1 January 2029 for Group 2 - 1 January 2030 for Group 3 The ACSR said a review of the first 91 Group 1 reporters found that disclosure quality still needed work. Assurance must follow the international standard ISSA 5000. Until then, listed companies must state whether their disclosures were internally reviewed or independently assured. Proposals for assuring Scope 3 and the wider IFRS S1 disclosures have not been finalised. On enforcement, the ACSR said in December 2025 that regulators will take a phased, practical approach: engagement and corrective action first, with enforcement reserved for companies that fail to fix problems or make wilful or misleading disclosures. What it means for smaller companies Most SMEs are not required to report under the NSRF. The practical impact comes through the value chain. When a listed customer starts reporting Scope 3 emissions, part of that figure is the emissions of the businesses it buys from. Expect more questionnaires from customers about energy use, fuel, waste and workforce data, often alongside tenders or supplier reviews. Capital Markets Malaysia publishes a Simplified ESG Disclosure Guide (SEDG) for SMEs in supply chains. It sets out a standard list of disclosures that large customers, banks and investors can ask for, and includes a greenhouse gas calculator for Scope 1 and 2 emissions. Version 2 is aligned with the ASEAN version of the guide. A sensible starting point: - Keep electricity, fuel and utility bills organised by month and by site. - Make sure purchases are coded consistently in your accounts, so spending on fuel, freight and materials can be pulled out quickly. - Keep headcount and payroll records up to date, since social disclosures often ask for them. - Check the timing: a Group 2 customer will need Scope 3 data for periods from 2028, and a Group 3 customer from 2030. Most of this data already passes through your books. A sustainability report is only as reliable as the records behind it. How Synco fits in Synco's chartered accountants (Shukri Yusof & Co., MIA firm NF1688) keep the accounting and payroll records that this kind of reporting draws on. Clean, well-coded books make it easier to answer a customer's data request when one arrives.