From Mitigating Social Controversies to Addressing Carbon Emissions and Global Warming: The Evolution of CSR and ESG Reports Regulation in Taiwan

In recent years, Corporate Social Responsibility (CSR) and Environmental, Social, and Governance (ESG) have evolved from voluntary practices to integral considerations, influencing not only investment decisions but also emerging regulations. Taiwan's capital market established non-financial disclosure standards, with state involvement and subsequent regulatory evolution. This study adopts a "markets as politics" approach to analyze the political processes shaping interactions among various actors, exploring the context of the developmental state and global governance. It underscores the developmental state's "will for development" and "bureaucratic ability," highlighting interactions across scales, including domestic and international, public and private norms. The research emphasizes the dominant role of financial regulatory institutions and limited civil society participation.

The regulatory construction process unfolds in three stages. In the 2000s, corporate governance reforms encouraged CSR disclosure, yet the lack of standardized regulations led to divergent corporate practices. By 2010, CSR norms were incorporated into corporate annual report regulations, gradually clarifying indicators, but had not become a widely followed market standard. State intervention was relatively limited. In 2014, responding to political pressures, the Financial Supervisory Commission (FSC) mandated specific industries to compile CSR reports and issued standards for preparation. While the state leverages bureaucratic ability, explicit developmental will is absent. Around 2020, global trends and domestic policy goals like "2050 Net-Zero Emissions" aligned existing CSR regulations with a new policy blueprint. The framework shifted from CSR to ESG, broadening mandatory reporting with quantitative indicators. The state demonstrated a clear will for development and bureaucratic ability.

International factors played a crucial role, serving as essential references for domestic regulatory adjustments. Facing sovereignty challenges, Taiwan aligned with global trends to stay ahead. The impact of supply chains and foreign investment was significant, driving domestic regulatory development and corporate practices. However, the implementation of international regulations might cause friction with local social structures.