Regulators and business leaders are raising the stakes on corporate sustainability, warning that firms failing to embed environment, social, and governance into their operations risk losing investor trust and market value.
High-quality reporting, they said, is no longer optional—it now drives capital flows and determines which companies thrive.
The forum, held at the Securities and Exchange Commission (SEC) eCenter in Makati on Monday, carried the theme “From Disclosure to Decision: How Sustainability Is Changing the Philippine Capital Market.”
SEC Chairperson Francis E. Lim argued that sustainability disclosure has moved from the margins to the center of investment decision-making, with climate risk, transition risk, governance weakness, and social fragility now measurable and material.
“Sustainability claims must not run ahead of fact. They must be grounded, measured, and governed with discipline. Anything less does not just weaken disclosure — it weakens the market,” Lim said.
He added that disclosure can no longer function as an aspirational narrative. It must be evidentiary, comparable, and embedded in governance and strategy.
The SEC issued Memorandum Circular No. 16 in 2025 to raise the quality of sustainability information available to the market, adopting an International Sustainability Standards Board-aligned framework under Philippine Financial Reporting Standards S1 and S2.
Implementation will be phased across three tiers of companies from 2026 through 2029. Tier 1 covers listed companies with market capitalization exceeding P50 billion, which are required to begin adoption this year, while smaller listed companies and large non-listed entities follow in subsequent years.
Lim said the SEC is pairing the requirements with capacity-building programs to ensure the reform is workable.
“Lasting reform is not issued. It is built,” he said.
Bangko Sentral ng Pilipinas (BSP) Assistant Governor Pia Roman Tayag said the banking sector is moving in the same direction, with 70 percent of banks now integrating sustainability into their strategies and 90 percent expressing inclination to support sustainable financing in areas such as climate-resilient agriculture, renewable energy, and climate-ready infrastructure.
“For us at the BSP, when we issue regulations and when banks see these regulations, we all understand that compliance is not the end,” she said. “It is to really fully integrate this — that ESG is sound for their business.”
Philippine Stock Exchange Senior Vice President Roel Refran said getting employees to genuinely embrace sustainability goals is what separates companies that succeed from those that merely comply.
“Sustainability is not just about compliance or cost of capital. Sustainability must be embedded into decision-making, not treated as an afterthought. In the end, this is about more than technical standards. It's about ensuring long-term resilience-for businesses, for markets, and for society. And while we don't have all the answers yet, we are learning as we go,” he said.
At the PSE, sustainability performance has been built into employee key performance indicators.
“This is us making sure by 2100, at the turn of the century, we created an impact — that’s what this story is about,” he said.
Metro Pacific Investments Corp. (MPIC) Chief Finance Officer and Chief Sustainability Officer June Cheryl Cabal-Revilla said the group transitioned from focusing solely on risk management to emphasizing overall resilience.
Cabal-Revilla cited how MPIC’s sustainability efforts and quality reporting resulted in real-world gains — Manila Electric Co. seeing a 35 percent increase in share price over the past 12 months and Maynilad Water Services Inc. recording a 30 percent increase in share price since its initial public offering in the fourth quarter last year.
“We operate as an open book, which is why we attract and work with newer groups of investors. Overall, our improved performance has been very positive. We are living proof that sustainability works,” she said.
Lim, for his part, emphasized the need for transparency, accountability, and quality in sustainability reporting.
“Trust depends on what can be verified. Sustainability claims must not run ahead of facts. They must be grounded, measured, and governed with discipline. Everything less does not just weaken disclosure, it weakens the markets,” he said.
The forum was supported by MPIC as the Gold sponsor, with SM Investments Corp. and San Miguel Corp. serving as Silver sponsors.
GCash, Globe Telecom, Inc., Ayala Corp., SM Prime Holdings, Inc., Development Bank of the Philippines, Maynilad, and GT Capital Holdings, Inc. were Bronze sponsors.
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