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The chairman of Malaysia's Securities Commission announced plans to formally request that publicly-traded companies disclose their preparation strategies for El Niño, as concerns mount that regional businesses remain underprepared for the climate phenomenon's potential fallout.
Speaking to Reuters during an investor roadshow in the United Kingdom, chairman Mohammad Faiz Azmi said the regulator will dispatch letters to all major listed companies, asking specifically: 'What is your El Niño plan?' The regulator intends to conduct follow-up discussions with the firms next year to evaluate whether their stated preparations translated into effective action.
The initiative will test whether existing climate-risk disclosures genuinely reflect operational readiness. Mohammad Faiz argued that many Malaysian companies have not seriously grappled with drought scenarios, largely because the country has historically enjoyed abundant water resources. Global forecasters have warned of a possible super El Niño, which could deliver prolonged heat and drought across South-east Asia, threatening crop yields and straining water supplies. Malaysia's palm oil industry, a cornerstone of the national economy, faces particular exposure to such conditions.
While market regulators worldwide have increasingly required climate-related disclosures, requests tied to specific weather events are typically not made public, making this initiative a notable departure from the norm.
In a separate development, Mohammad Faiz disclosed that the Securities Commission is exploring closer regulatory ties with counterparts in the Middle East, aiming to deepen Islamic finance links and channel additional capital flows into South-east Asia. As an initial step, the regulator is conducting a comparative analysis of how different jurisdictions classify stocks as Sharia-compliant.
The commission also signed an agreement in July with Hong Kong's Securities and Futures Commission enabling companies pursuing dual listings to rely on a single prospectus and unified submission documents, effective from September. Mohammad Faiz identified Sarawak Energy as a candidate the commission is encouraging to consider such a dual listing path, suggesting the company could reach a valuation of approximately US$10 billion when it eventually comes to market. Sarawak Energy did not respond to a request for comment outside office hours.
Asked whether AirAsia was on the regulator's surveillance watchlist, Mohammad Faiz declined to confirm or deny, while noting that the government had engaged consultants to review the carrier's financial position. He was unaware of any takeover plans. AirAsia did not respond to a request for comment, while co-founder Tony Fernandes stated publicly on Friday, September 18, that no discussions with the government had taken place and that the airline required no rescue or bailout.
On the broader market outlook, Mohammad Faiz outlined a government target for Bursa Malaysia's capitalisation to reach 6.3 trillion ringgit (US$1.55 trillion) over five years, up from approximately 4.5 trillion ringgit at present.
Source: businesstimes.com.sg (Reuters)