Philippines SEC mandates PFRS Sustainability Disclosures starting fiscal year 2026

The Philippines SEC issued Memorandum Circular 16 of 2025 on December 22, 2025, mandating ISSB-aligned PFRS S1 and S2 sustainability disclosures for listed and large non-listed entities under a tiered timeline. The regional move toward mandatory, assured climate reporting offers Indian regulators and listed companies a comparator as BRSR assurance requirements evolve.

The Securities and Exchange Commission of the Philippines issued Memorandum Circular No. 16, Series of 2025, on December 22, 2025, mandating adoption of the Philippine Financial Reporting Standards on Sustainability Disclosures by publicly listed companies and large non-listed entities. The framework incorporates PFRS S1, establishing general disclosure requirements, and PFRS S2, focusing on climate-related risks and opportunities, replacing previous voluntary guidelines and aligning with the International Sustainability Standards Board to provide investors comparable, decision-useful data.

Implementation follows a tiered approach. Tier 1 covers publicly listed companies with market capitalization exceeding ₱50 billion as of December 31, 2025, who must submit first reports in 2027 on 2026 performance. Tier 2 covers listed companies between ₱3 billion and ₱50 billion, applying standards from fiscal years beginning on or after January 1, 2027. Tier 3 expands to smaller listed firms and large non-listed entities with annual revenues exceeding ₱15 billion, with mandatory disclosures for fiscal 2028.

Covered companies must obtain independent limited assurance for Scope 1 and Scope 2 greenhouse gas emissions two years after their respective adoption dates, complying with the International Standard on Sustainability Assurance 5000. Entities should leverage transitional reliefs, omitting Scope 3 emissions for the first two years and forgoing comparative information in the initial year, to build internal reporting capacities. Affected firms should monitor adoption deadlines tied to their tier and treat compliance as core risk mitigation and capital access.

Key figure — Tier 1 threshold: publicly listed companies exceeding ₱50 billion market capitalization, first reporting in 2027