The Singapore Exchange (SGX) may set up a Singapore Sustainability Index to guide investors on the way listed companies approach environmental, social and governance (ESG) issues.
SGX chief executive Magnus Bocker said on Tuesday the bourse operator was mulling over the idea as more investors were becoming aware of sustainability issues.
The proposed index would help guide investors in picking stocks based on ESG factors, such as whether a company uses green energy or works sympathetically with poor people affected by its operations.
"Investors are increasingly diversifying their portfolios by investing in companies and products that set industry best practices with regard to sustainability," he said in his keynote address at the Responsible Investor's RI Asia 2013 Conference at the SGX Centre.
SGX will also review the scope of Global Reporting Initiative's (GRI) fourth-generation sustainability guidelines which will be available by May. GRI is a Dutch-based non-profit body.
The current third-generation version of the widely used and globally accepted framework was introduced in March 2011.
Several stock exchanges in Asia have already raised the bar in the push towards ESG.
In China, capital market stakeholders are leading the implementation of progressive regulations on a broad range of ESG issues.