# National Sustainability Reporting Framework (NSRF)

This policy applies to business that meet the following criteria.

#### Region

Malaysia

#### Industries

Commercial and Industrial Real Estate ||| Construction and Real Estate ||| Energy and Utilities ||| Financial Services ||| Manufacturing ||| Real Estate Development ||| Retail and Consumer Goods ||| Technology and Telecommunications ||| Transportation and Logistics

#### Revenue

Main Market listed issuers (≥RM 2 billion market cap) ||| ACE Market issuers & large private companies (≥RM 2 billion revenue)

#### Assets

#### Size

N/A

#### Status

Public ||| Private

#### Required

Yes (phased compliance FY 2025-2030)

### Overview NSRF

**Introduced:** September 24, 2024 (final framework issued)

**Effective from:** FY 2025 (climate-first reporting phase begins)

**Last modified:** October 21, 2024 (public response paper)

**Region(s):** Malaysia

### About NSRF

[Malaysia’s National Sustainability Reporting Framework (NSRF)](https://www.sc.com.my/nsrf) lays the groundwork for mandatory ESG disclosure across capital markets, transitioning the country from voluntary [TCFD](https://www.fsb-tcfd.org/) adoption to full compliance with [IFRS S1 (General Disclosures) and IFRS S2 (Climate Disclosures)](https://www.ifrs.org/products-and-services/sustainability-products-and-services/ifrs-sustainability-alliance/?utm_term=esg%20reporting&utm_campaign=Sustainability+Alliance+Membership&utm_source=adwords&utm_medium=ppc&hsa_acc=4381683058&hsa_cam=21620248535&hsa_grp=166847584496&hsa_ad=710797337720&hsa_src=g&hsa_tgt=kwd-2211793615&hsa_kw=esg%20reporting&hsa_mt=b&hsa_net=adwords&hsa_ver=3&gad_source=1&gad_campaignid=21620248535&gbraid=0AAAAA9xBoKLp9fmXIaLPNo3xrv9m8LkU3&gclid=Cj0KCQjwgvnCBhCqARIsADBLZoKSH1TBR2B99vlMtXXZVaUoz0kZkzVwOyPc6Ug1l0M5uCQNfGHHifUaAgVVEALw_wcB).

Spearheaded by the [Securities Commission Malaysia](https://www.sc.com.my/), the NSRF introduces a phased and proportionate approach to climate and ESG transparency, reinforced by national capacity-building initiatives like the [PACE Hub](https://www.sc.com.my/nsrf/pace).

The framework begins with climate-related disclosure for the largest issuers and eventually scales to include general ESG data and Scope 3 emissions, with assurance requirements on the horizon post-2027.

### Criteria for compliance

##### Group 1

Main-Market issuers with market capitalization ≥ RM 2 billion.
- **FY 2025:** IFRS S2 compliance begins.
- **FY 2026:** IFRS S1 compliance begins.
- **FY 2027:** Scope 3 and full ESG disclosures due.

##### Group 2

All remaining Main-Market issuers.
- **FY 2026:** IFRS S2 compliance begins.
- **FY 2027:** IFRS S1 compliance begins.
- **FY 2028:** Scope 3 and full ESG disclosures due.

##### **Group 3**

ACE-Market issuers and large non-listed companies (≥ RM 2 billion annual revenue).
- **FY 2027:** IFRS S2 compliance begins.
- **FY 2028:** IFRS S1 compliance begins.
- **FY 2030:** Scope 3 and full ESG disclosures due.

### Compliance timelines

##### FY 2025

Group 1 begins mandatory climate reporting under IFRS S2.

##### FY 2026

Group 2 climate reporting; Group 1 adds general ESG (IFRS S1).

##### FY 2027

Group 3 begins climate reporting; Group 2 adds ESG; Group 1 must include Scope 3.

##### FY 2028

Group 3 adds ESG; Group 2 must include Scope 3.

##### FY 2030

Group 3 must report full-scope ESG and Scope 3 emissions.

##### Post-2027

Mandatory assurance requirements under review.

### Disclosure requirements

- Scope 1 and 2 emissions required from the start; Scope 3 phased by entity group.
- IFRS S1 ESG disclosures begin in second reporting year, covering additional material topics such as labor, biodiversity, and supply chain risks.
- IFRS S2-aligned climate disclosures: Governance, strategy (including scenario analysis), risk management, metrics, targets.
- Reports must be filed in XBRL format via [Bursa Malaysia](https://www.bursamalaysia.com/) or the Companies Commission (SSM) portal.

##### Key obligations
- Include NSRF disclosures in annual reports.
- Submit filings via approved digital platforms.
- Maintain audit-ready documentation for emissions and scenario planning.
- Obtain board-level signoff.
- Prepare for limited assurance requirements within two cycles of first reporting year.

### Third-party assurance

Assurance is not required initially. However, limited assurance on key metrics is expected within two reporting cycles for each group, with Group 1 potentially facing assurance as early as FY 2027.

### Penalties for non-compliance

Failure to comply may result in:
- Fines and administrative action under [Bursa Malaysia Listing Requirements](https://www.bursamalaysia.com/regulation/listing_requirements/main_market/listing_requirements).
- Public reprimands or delisting risks.
- Enforcement under the Companies Act for private entities.
- Reputational harm and investor confidence impacts.