Bangkok, SEC Secretary-General said the Cabinet passed the Thai ESG criteria, focusing on long-term savings, believing it will support the capital market. The SEC is ready to accelerate. As for the Stock Exchange of Thailand, changing the compiler of the SET ESG Ratings will not affect it, but will be more beneficial to investors.
Assoc. Prof. Dr. Pornanong Busaratrakul, Secretary-General of the Securities and Exchange Commission (SEC), revealed after the Cabinet approved the principle of the draft ministerial regulation to provide tax privileges to promote investment for Thailand’s sustainability in Thai ESG by expanding the personal income tax deduction limit from 100,000 baht per tax year to 300,000 baht per tax year, not exceeding 30 percent of assessable income, and reducing the holding period of investment units to no less than 5 years from the original 8 years, counting from day to day, effective for investment units purchased from January 1, 2024 to December 31, 2026, that the approval of the new TE
SG criteria is a very positive factor. In the past, the SEC has been working in parallel and will work more quickly from now on by expanding the stocks that funds can choose to invest in. Originally, it was a listed company that was in the ESG Rating and/or had disclosed information on various Carbon Footprints, with an increased emphasis on G (Governance) by expanding the assessment of corporate governance (CGR) to an excellent level of 90 points or more from a full 100 points, resulting in an increase in the number of stocks that can expand investment by 136 listed companies, which must be combined with the disclosure of a value-up plan and have a clear business plan, such as stating that the company will be included in the SET ESG Rating assessment plan at the international level in the next 2 years, etc.
I would like you to view the Thai ESG Fund as a long-term savings, which the government has promoted by providing tax benefits. Investing in stocks should not be viewed in the 1-2 month period, but shoul
d be viewed in the long term. Investing in Thai ESG has a minimum holding period of 5 years. Last year, Thai ESG had only one month, generating approximately 6 billion baht. This year, with the remaining 4-5 months, coupled with more relaxed conditions, I believe that it will have a positive effect on the capital market. However, it is not aimed at speculation, but rather at converting spending into savings and converting savings into investment. When there is information in the future, investors can invest by themselves and expand their investment base.
In the case of the Stock Exchange of Thailand changing the ESG Ratings provider from SET to FTSE Russell at this time, it is considered an upgrade to be on par with international standards. From being voluntary, it will become FTSE Russell, assessed from information disclosed by listed companies to the public. It is believed that this will result in an upgrade. However, investors do not need to worry because companies in the original ESG Rating will be able
to transfer to FTSE Russell plus SET100 and will be assessed according to FTSE Russell’s criteria. It is believed that no one will be left out and new companies will be added in 2026. This will be beneficial to investors who can use the information for comparison.
However, during this time, the ESG ratings from SET can be used until the official change of the ESG ratings provider to FTSE Russell. After that, Thai ESG can request to amend the project details to change to the assessment results provided by FTSE. Such amendments can be made easily by submitting a request to amend the project details through the office system, which will be immediately approved.
In the case that the asset management company wishes to use the services of other assessors, such as SandP Global MSCI, etc., it can do so. The office will consider whether the change in assessors will change the risk of the fund and should amend the project details by relying on the office’s authority to consider and approve or request a resolution fro
m unitholders. As for the asset management company, it can submit a request to establish a new Thai ESG using the assessment results of stocks with outstanding E or ESG from assessors who meet the specified criteria from the effective date of the revised announcement (expected to be August 16, 2024). In addition, Thai ESG is exempted from the application fee for project establishment and amendment from the SEC, similar to the SRI Fund, throughout 2024.
For the measures to enhance the supervision of the Stock Exchange, price volatility/fairness in trading, supervision of inappropriate trading behavior/stocks with abnormal trading conditions after implementing the Uptick rule measure on July 1, 2024, it was found that during July 1-26, 2024, the value and volume of short selling transactions in the SET on average per day decreased compared to the previous period (January-June 2024), broken down into the average short selling value per day of approximately 1,686.30 million baht, down 68.01%, and the average sho
rt selling volume per day of approximately 95.96 million shares, down 69.76%. The value of short selling transactions accounted for 4.53% of the average daily trading value, down from 11.65% in the previous period, and the short selling volume accounted for 0.89%, down from 1.9% in the previous period, while the average daily trading transactions via Program Trading after implementing the measure in the SET also decreased.
In terms of enforcement of the Statistics Act, from January 1 to July 30, 2024, the SEC has filed charges against offenders with the investigation officers of the Technology Crime Suppression Division and the Department of Special Investigation (DSI) in 6 cases, consisting of unfair acts in the trading of securities/digital assets (price manipulation in 2 cases) and corruption in 4 cases, while the implementation of civil penalty measures includes:
10 cases of unfair acts in securities/digital asset trading (8 cases of price manipulation and 2 cases of insider trading)
Agreement to recor
d consent to comply with civil penalty measures set by the Civil and Commercial Code in 7 cases, total fines approximately 440 million baht.
Source: Thai News Agency