Hayleys PLC: A Disclosure Profile of Sri Lanka’s Largest Conglomerate by Revenue

In Sri Lanka’s diversified conglomerate sector, John Keells Holdings is the largest listed company by market capitalisation and the reference point against which peers are measured. Hayleys PLC is the natural comparison: a group that out-earns John Keells on revenue and out-employs most of corporate Sri Lanka, yet trades at roughly half its market value. How the two disclose — where they lead each other, and where they lag — is the first real test of whether the ESGNexus Sustainability Index can compare like with like.

This profile assesses the quality of the disclosure — whether the report meets the requirements of SLFRS S1 and S2 — not the company’s underlying sustainability performance, which no published report can certify. It is based on Hayleys’ Annual Report 2025/26, for the year ended 31 March 2026, and on the independent assurance reports published alongside it. Every finding below concerns what the report does and does not say.

Hayleys PLC is a holding company operating across fourteen business sectors — from Eco Solutions, Hand Protection and Purification Products to Plantations, Textiles, Transportation & Logistics, Consumer & Retail and Leisure — with subsidiaries and equity-accounted investees listed across more than a dozen pages of the annual report. In FY2025/26, the group reported revenue of Rs. 585.0bn (up 19%), EBITDA of Rs. 64.8bn and profit after tax of Rs. 22.2bn, with total assets of Rs. 645.8bn. It employs 38,746 people, placing it among the country’s largest private-sector employers. That breadth poses an analytical challenge as much as it is a source of commercial strength: a fourteen-sector footprint spanning tea estates, glove factories, construction materials and shipping is far harder to measure, aggregate and decarbonise than a more concentrated portfolio — which makes the completeness of Hayleys’ disclosure the key question.

Hayleys states that its sustainability-related disclosures have been “prepared in accordance with SLFRS Sustainability Disclosure Standards as issued by CA Sri Lanka” — a strong compliance formulation, not the softer “with reference to” or “guided by.” The report is anchored in the Integrated Reporting <IR> Framework and draws on GRI Standards, SASB metrics, TCFD-style climate scenario analysis, and an early (Phase 1) adoption of the TNFD nature-related disclosures, mapped to the UN SDGs. Materiality is assessed on a double-materiality basis: financial materiality for the integrated report and impact materiality for the ESG report — a broader lens than SLFRS’s single financial-materiality requirement.

For assurance, Hayleys assembles a four-part stack. Ernst & Young audits the financial statements. KPMG provides limited assurance over the integrated report and, separately, over selected qualitative SLFRS S1 and S2 disclosures — the governance, strategy and risk-management content mapped to specific paragraphs of the standards — under SLAE 3000, dated 8 June 2026. Control Union verifies the group’s GHG inventory in accordance with ISO 14064-1:2018. This matters for the John Keells comparison: John Keells’ DNV assurance explicitly excluded its SLFRS S1/S2 disclosures, whereas Hayleys has obtained assurance mapped directly to the standards. The honest caveat is scope. KPMG’s SLFRS engagement covers the qualitative disclosures — governance, strategy and risk — not the emissions metrics; those are verified separately by Control Union, whose ISO 14064-1 boundary spans Scope 1, Scope 2 and selected material Scope 3 categories across all fourteen sectors and 195 subsidiaries on a financial-control basis. What no single provider yet offers is a reasonable-level opinion over both the narrative and the numbers: each engagement is pitched at a limited level — a “nothing has come to our attention” conclusion rather than a positive opinion.

That reporting carries external validation. At the Institute of Chartered Accountants of Sri Lanka’s TAGS Awards 2025 — which judged 2024/25 annual reports — Hayleys took Gold for Overall Excellence in Corporate Reporting for the fourth consecutive year, alongside Gold for Sustainability Reporting and for Corporate Governance Disclosure among non-financial institutions; John Keells Holdings placed Bronze in the overall category. The distinction worth holding onto is that these awards reward the quality of disclosure, not the substance of what is disclosed — the same line this profile walks when it credits Hayleys’ completeness while flagging its concentration of control.

Hayleys reports a total carbon footprint of 763,955 tCO₂e for FY2025/26, essentially flat year on year. The direct and energy emissions — Scope 1 at 113,207 tCO₂e and Scope 2 at 72,587 tCO₂e, 185,794 tCO₂e combined — are close to the whole of John Keells’ reported footprint. The difference is what Hayleys adds on top: 578,161 tCO₂e of Scope 3, value-chain emissions reported across all fourteen sectors, with between six and fourteen of the fifteen GHG-Protocol categories captured per sector and computed using IPCC AR6 and DEFRA 2025 emission factors. John Keells disclosed no Scope 3 at all in its first mandatory year. The whole inventory — all fourteen sectors and 195 subsidiaries, on a financial-control boundary — is verified group-wide by Control Union under ISO 14064-1:2018. On the completeness of environmental disclosure, the smaller company is ahead.

Hayleys also sets dated targets where John Keells sets none: a 2030 goal of 30% absolute reductions in Scope 1 and Scope 2 against a 2018/19 baseline, a 10% reduction in Scope 3, a 4% annual reduction for newly acquired entities, and a 2050 net-zero roadmap. The climate risk underpinning those targets is scenario-tested: the report models IPCC AR6 physical-risk scenarios (SSP1-2.6, SSP2-4.5 and SSP3-7.0) and IEA World Energy Outlook 2023 transition scenarios (Net Zero, Announced Pledges and Stated Policies), sensitised to Sri Lankan conditions. Two caveats keep this honest. First, the targets are not externally validated — the report’s own target table records “third-party frameworks: No” — even though selected subsidiaries such as Hayleys Fabric commit separately to the Science Based Targets initiative, and the scenario work’s financial-effect quantification remains qualitative. Second, the Scope 3 target is set against a 2018/19 baseline of roughly 5,548 tCO₂e, a figure not comparable to the 578,161 tCO₂e now reported after the reporting boundary was widened; a target and an inventory measured on different bases cannot yet be read together.

The group employs 38,746 people, up 2% year on year, with female representation at 34%. It invested Rs. 325m in training (up two-thirds year on year), averaging about fifteen training hours per employee, and recorded 588 workplace injuries, down 26%. Community investment totalled Rs. 444m through the Hayleys Foundation, reaching 668,859 beneficiaries. The social metrics are disclosed at group level in the ESG performance statement, with three years of comparatives, which aids readability; the granularity that a fourteen-sector group could in principle provide — sector-level workforce, safety and pay breakdowns — is thinner in the consolidated view.

This is where Hayleys and John Keells diverge most sharply, and not in Hayleys’ favour. Hayleys is a controlled company. Dhammika Perera (K.D.D. Perera) holds 382,613,630 of 750 million shares — roughly 51%, including indirect holdings through companies he controls — and the public holding is just 37.09%. The company reports under the CSE listing option, which has no minimum public float requirement. John Keells, by contrast, has no controlling shareholder and a free float above 70%.

The board reflects this concentration. Of the thirteen directors, seven (54%) are non-executive, but only four (31%) are independent, compared with John Keells’ 56%; six of the thirteen are executive. The controlling shareholder sits on the board as Co-Chairman, while Mohan Pandithage holds the combined role of Chairman and Chief Executive — a structure Hayleys shares with John Keells, but it is less counterbalanced here, given the lower independence ratio. A Senior Independent Director is in place, and the four statutory committees — audit, remuneration, nominations and governance, and related-party transactions — operate alongside an ESG Steering Committee and a Risk Management Committee. None of this is improper; concentrated ownership is common and legal on the CSE. But for investors reading governance as a risk factor, the combination of a majority owner, a co-chair seat for that owner, a joint chair-CEO and a minority-independent board is a materially different profile from the widely held structure next door.

ESGNexus grades disclosure completeness against a published, equal-weighted, page-referenced checklist of seven criteria drawn from SLFRS S1 and S2 (Disclosure Grading Methodology v1.0). We assess what the report does and does not disclose — not the company’s underlying performance. Each criterion is scored as Present (1), Partial (0.5), or Absent (0), or N/A where it genuinely does not apply. The full checklist below is reproducible: the same report and this rubric should yield the same result.

Alongside the checklist, we characterise the disclosure on four qualitative dimensions — completeness, comparability, credibility and candour — each rated against cited evidence. These carry the nuances the checklist score does not, including the qualified assurance basis.

On completeness, Hayleys leads its larger peer: Scope 3 is quantified, 2030 and 2050 targets are set, and climate scenario analysis is performed using named scenarios — three things John Keells did not do in its first mandatory year — though the Scope 3 target baseline is not yet reconciled to the widened inventory. On comparability, the report is strong: SLFRS S1/S2, GRI, <IR>, SASB and TNFD are used together, with three-year comparatives in the ESG statement. On credibility, assurance is broader than John Keells’ in coverage — KPMG’s opinion is mapped to the SLFRS standards and the emissions inventory, and selected Scope 3 is verified by Control Union under ISO 14064-1 — but it is split across two providers, pitched at a limited rather than a reasonable level, with no single opinion spanning both the narrative and the numbers. On candour, the report is clean to the point of being quiet: nil corruption incidents, nil non-compliance and no material fines across three years, with none of the incident-level bad news — fraud counts, fines — that John Keells disclosed in its own words.

For investors, Hayleys offers more comprehensive climate data than the sector leader, but its governance structure concentrates control — a trade-off worth pricing explicitly, rather than assuming disclosure breadth and governance strength move together. For peers, Hayleys shows that a fourteen-sector group can quantify Scope 3, run named-scenario climate analysis and obtain SLFRS-mapped assurance in year one, removing the “too complex” excuse. For regulators, the gap between assured qualitative disclosures and separately-assured emissions numbers — and targets set against baselines that no longer match the inventory — shows where the next tightening of the SLFRS regime will have to bite.