KUALA LUMPUR (May 23): Capital Markets Malaysia (CMM) will be issuing specialised disclosure guidance for small- to mid-sized companies in five sectors involved in global supply chains, according to the Ministry of Finance (MOF).

The guidelines, an extension of the simplified environmental, social and governance (ESG) guides launched in 2023, will cover energy, transport-and-storage, construction-and-real estate, agriculture, and manufacturing, according to Finance Minister II Datuk Seri Amir Hamzah Azizan.

"This will provide necessary guidance on the additional environmental and social disclosures expected of these sectors, in order to remain competitive within the global supply chain and marketplace," the minister said in a speech read by Treasury secretary general Datuk Johan Mahmood Merican at an event on Thursday.

The broader document by CMM, an affiliate of the Securities Commission Malaysia (SC), will provide simplified and standardised ESG-related guidelines on disclosures aimed at small and medium enterprises (SMEs).

The disclosures would be in line with global and local ESG frameworks, including the Global Reporting Initiative, the International Sustainability Standards Board, the Bursa Malaysia Sustainability Reporting Guide, and Malaysian Code on Corporate Governance.

The initiative was announced as part of the SC's five-year plan that covers micro, small, and medium enterprises (MSMEs), as well as mid-tier companies (MTCs) unveiled on Thursday, entitled Catalysing MSME And MTC Access to the Capital Market: 5-Year Roadmap (2024-2028).

Under the road map, the SC plans to help MSMEs and MTCs raise RM40 billion from the capital market by 2028. The aim is for capacity building, and to create a visible and sustainable pipeline of high-potential SMEs and MTCs ready for capital market fundraising.

Apart from the guide, financing guarantor Credit Guarantee Corporation Malaysia Bhd (CGC) will explore and discuss with more equity crowdfunding and peer-to-peer financing platforms to offer guarantees for their solutions, according to Amir Hamzah.

This follows an additional RM30 million guarantee by CGC for working capital under a term loan with digital financing platform Funding Societies for financing of up to RM500,000, launched in early May.

"Hopefully, more guarantee products can be issued by the first half of 2024, further bolstering efforts to provide greater access to capital market financing," Amir Hamzah said.

Further, the MOF called on the SC to revitalise the LEAP Market by addressing two main challenges faced by MSMEs and MTCs, namely the high cost of fundraising, and lack of clear pathways to access the public market and transition to a higher-tiered board, he said.

"The aim is to have these new LEAP Market measures ready by early next year," Amir Hamzah added.