(From left) Singapore Exchange CEO Loh Boon Chye, Bursa Malaysia CEO Datuk Muhamad Umar Swift, Philippine Stock Exchange CEO Ramon S Monzon, Stock Exchange of Thailand president Dr Pakorn Peetathawatchai and Indonesia Stock Exchange CEO Iman Rachman.

KUALA LUMPUR (July 16): Six major Asean stock exchanges have agreed to jointly pursue efforts to offer depository receipts (DRs) in their respective exchanges, expanding access for domestic investors to investment opportunities in neighbouring countries.

“This follows last year’s DR linkage between SGX (Singapore Exchange) and SET (Stock Exchange of Thailand) which has yielded positive results, setting the stage to progress this to an Asean-level initiative,” said a statement issued after the 37th Asean Exchanges CEOs Meeting hosted by Bursa Malaysia in Penang on Tuesday.

The meeting was attended by the CEOs of Bursa Malaysia, SGX, SET, Indonesia Stock Exchange (IDX), Philippine Stock Exchange (PSE), as well as the deputy CEO of Vietnam Exchange. Representatives from Cambodia Securities Exchange and Lao Securities Exchange were also present as observers.

The statement noted that on the sustainability front, the past year saw growing momentum, with increased information sharing among Asean exchanges and observers, as well as the adoption of common ESG metrics.

"Peer exchanges have given their respective inputs to an ESG landscape survey to prioritise future ESG initiatives to be undertaken by the exchanges," it said.

The statement added that the Asean exchanges have agreed to pursue four proof-of-concepts (POCs) over the next three years, including harmonising data structures and standards to form an aggregated Asean view, which aims to create a unified commercial policy and operating model.

The POCs also included the creation of a standardised Asean ESG (environmental, social and governance) curriculum, transition financing for corporates’ suppliers and reward listed issuers with good ESG performance.

Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift said the POCs focused on the exchanges' collective energy and resources on exploring and deploying workable models in targeted strategic areas.

“These areas aim to elevate competitiveness by developing common data infrastructure, enhancing capacity building capabilities through economies of scale, and building an inter-connected marketplace to facilitate transition financing and capital deployment into businesses with superior ESG practices,” Muhamad Umar said.

The statement also noted that the Asean-Interconnected Sustainability Ecosystem (Asean-ISE) initiative, which started with a memorandum of understanding between Bursa Malaysia, IDX and SET, has expanded to include SGX (February 2024) and most recently PSE (July 2024).

“This significant development underscores the Asean bloc’s commitment in adopting and implementing common ESG metrics within their respective ESG data infrastructures, hence, significantly improving transparency, comparability, and exemplary ESG practices across the region,” it said.