As many as 21 more of the world's stock exchanges could introduce sustainability reporting standards before the end of the year, bringing the total number to 38, an UNCTAD official said.
Seventeen stock exchanges already recommend their listed companies to report on environmental, social, and governance (ESG) issues, but James Zhan, Director of the Division on Investment and Enterprise at UNCTAD, which co-organizes the Sustainable Stock Exchanges (SSE) initiative, said that 23 stock exchanges had committed to introduce new standards on sustainability reporting in 2016.
Just two have implemented so far, but more are expected to introduce new standards before the end of the year, he said.
"21 stock exchanges have confirmed to us they will introduce new guidelines either this year or within the first quarter of next year, and we know that many of them are close because they have posted draft guidelines on their websites for comment and discussion," Mr. Zhan said.
"Sustainability reporting has come of age," he said, adding that the UN and NGOs are no longer the only ones to advocate sustainability reporting and that the markets themselves are demanding it.
By reporting on sustainability issues, companies tend to act more sustainably too, Mr. Zhan said. They may have an incentive to do so, since analysts increasingly see a positive correlation between sustainable performance and strong financial performance too.
Mr. Zhan said the SSE initiative had helped spread corporate sustainability reporting, by distributing model guidelines for use by the stock exchanges themselves and their listed members.
The SSE initiative works to "advance sustainability" in the markets. It is organized by UNCTAD, the United Nations Global Compact, the United Nations Environment Programme Finance Initiative (UNEP-FI) and the Principles for Responsible Investment.
The private sector is seen as critical to achievement of the UN's Sustainable Development Goals, and the SSE initiative is an important channel to get the private sector more involved in these Goals.
Launched by UN Secretary-General Ban Ki-moon in 2009, the initiative now includes over 60 stock exchanges, representing more than 70% of listed equity markets, and some 30,000 companies with a market capitalization of over $55 trillion.
"Market expectations are shifting quickly and we see more and more stock exchanges viewing sustainability reporting as necessary and inevitable," said Anthony Miller, UNCTAD's SSE initiative coordinator. "Those expectations create their own momentum," he added.