Singapore recently launched the ESG Impact Centre, a new entity designed to promote ESG finance collaboration. The launch comes shortly after the Singapore government announced its roadmap to become a global leader in green finance and sustainable fintech.
The Centre was launched on 5 October 2022 by the Monetary Authority of Singapore (MAS), Singapore’s central bank. It aims to stimulate the ESG ecosystem by facilitating interactions between fintech companies, financial institutions, investors and other ESG stakeholders.
What is Environmental, Social and Governance (ESG)?
ESG refers to a set of corporate governance standards that reflect a company’s impact on environmental, social and governance externalities. ESG indicators are used by consumers and investors seeking to make sustainable and socially conscious decisions. They are increasingly used by all types of investors as a means of assessing a company’s risk exposure and growth opportunities.
Who makes up the ESG Impact Centre in Singapore?
The ESG Impact Centre was launched with 15 founding members. Members range from professional services firms specialising in ESG and environmental NGOs to financial institutions and fintech companies.
Recognising the growing importance of ESG in investment, consumer and business decisions, Singapore established the ESG Impact Centre to highlight the country’s role as one of Asia’s leading financial centres.
How will the ESG Impact Centre develop the ESG ecosystem in Singapore?
Specifically, MAS has outlined three ways in which the ESG Impact Centre will develop the ESG ecosystem in Singapore.
Developing ESG Fintech: The Centre will facilitate the discovery, scaling and deployment of technology solutions to meet the ESG needs of businesses and financial institutions, particularly in terms of accurate measurement, reporting and validation of climate and sustainability data.
Anchoring ESG enablers: MAS will work with knowledge partners, financial institutions and investors to organise key ESG initiatives outside the centre, such as the ESG FinTech Accelerator programme, training and capacity building workshops and thought leadership events.
Supporting ESG stakeholders: MAS will work with the Hub community to deploy its programmes and solutions to drive substantial and quantifiable impact to support sector transformation efforts. The focus will be on the eight priority areas identified by the Singapore Green Finance Industry Taskforce (GFIT).
Where is the ESG Impact Centre located?
The ESG Impact Centre will be located in the Great Room at the Asia-Africa Building. The Great Room is a co-working space that will offer special benefits to the Centre’s partners.
How is Singapore promoting ESG development?
The ESG Impact Centre is the Singapore Government’s latest initiative to promote green finance and the ESG ecosystem. According to MAS, the centre will ‘anchor’ government-backed industry-driven sustainability initiatives such as the Point Carbon Zero initiative with Google and the ESG Business Foundry with KPMG.
MAS and Google Cloud jointly launched the Point Carbon Zero programme in July 2022 to promote innovation, incubation and scaling of climate fintech in Asia. Specifically, it aims to increase access to climate-related data for the financial sector as a means of channelling capital into sustainable investments. Meanwhile, the ESG Business Foundry is a six-month accelerator programme designed to help ESG fintech start-ups scale up their businesses.
Both ESG Impact Hub and the above industry partnerships are part of Singapore’s Project Greenprint, an initiative launched by MAS in December 2020 to promote a green financial ecosystem through innovation and technology by mobilising capital, monitoring sustainability commitments and measuring impact.
Project Greenprint has four main platforms, which MAS envisages working in tandem to advance the project’s objectives. The four platforms are
Common ESG Disclosure Platform: A common platform for managing and accessing ESG performance data to meet local and international disclosure requirements.
Data Orchestrators: A network of data platforms that aggregate and support access to trusted ESG data sources.
ESG Registry: A network of registries on the blockchain to record and maintain ESG authentication and verification data.
Greenprint Marketplace: an open marketplace connecting green technology providers with investors, financial institutions and companies.
Singapore’s green finance ambitions
A series of new initiatives unveiled by MAS in 2022 reflect the Singapore government’s broader goal of becoming a world leader in green finance and sustainable fintech. in September 2022, MAS released its Industry Transformation Map 2025, which aims to grow the country’s already strong financial sector by 2025 by embracing green finance, incubating talent, digitising financial infrastructure and simplifying the corporate structure used by investment funds.
As part of the plan, the Singapore government will provide S$100 million (US$73.61 million) in grant funding for capacity building, green fintech, climate risk and reinsurance, and sustainable and transformational financing solutions. The programme also includes efforts to improve ESG disclosure and data utility, for example through the Greenprint project, and to promote decarbonisation of the real economy through sustainable financing solutions.