The Stock Exchange of Thailand (SET) plans to have 35-40 listed companies on a list of prime performers on environmental, social and governance aspects, paving the way for the launch of a sustainability index next year.
SET chairman Sathit Limpongpan (centre) joins representatives of the Association of Investment Management Companies, Thai Listed Companies Association and Khon Thai Foundation to kick off the Thailand Sustainable Investment project. The project urges businesses to be more concerned with environmental, social and governance (ESG) issues. A list of ESG companies will be released this year.
The list will be completed within the third quarter, SET president Kesara Manchusree said.
The SET has joined forces with the Securities and Exchange Commission, Association of Investment Management Companies, Association of Thai Securities Companies, Thai Institute of Directors Association, Thai Listed Companies Association and Khon Thai Foundation to enhance Thailand's sustainable investment.
The working committee comprises executives from all seven organisations. The list will be reviewed on an annual basis.
The evaluation has been designed in line with the guidelines of the Dow Jones Sustainability Index but will be adjusted to suit Thailand's economy, culture and society, SET chairman Sathit Limpongpan said.
"Thai listed firms will be encouraged, not forced, to follow the procedures step by step. We do not intend to burden listed companies. However, our long-term goal is to internationalise Thai listed companies to go global together," he said.
Voravan Tarapoom, chief executive at BBL Asset Management, said the country's first sustainable fund, B-Kind, had an asset size of around 2 billion baht after being launched by her company in October, but its net asset value at 8-9 baht is still lower than its 10-baht initial public offering price.
Like other stocks, shares invested by the B-Kind fund have been weighed down by the recent stock market pullback but the fund is expected to yield attractive returns to unit trust holders in the long run, she said.
B-Kind allocates at least 80% of its assets in SET and MAI-listed companies that are considered to have social responsibility for the environment, society, governance and corruption.
"We just want to test the market's response to this kind of fund, but the result has been very good, as investors understand investment in sustainable companies will take time to earn better returns," said Mrs Voravan.