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Business Times
16-05-2025
- Business
- Business Times
Issue 148: South-east Asia's strategic bet on sustainability; Sembcorp's renewables win analysts' calls
This week in ESG: Top South-east Asian representatives reaffirm commitment to sustainability; Goldman Sachs initiates 'buy' call on Sembcorp Industries Sustainable finance South-east Asia's crisis opportunities The current atmosphere of political and economic uncertainty around the world gives South-east Asia an opportunity to invest in a more sustainable and resilient future. But policymakers and regulators must take the lead with clear goals and credible plans. Top South-east Asian representatives at the recent Ecosperity conference sought to reaffirm the region's commitment to sustainable finance. Malaysia's Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad urged protection of South-east Asia's population and coastal cities, and said that climate cooperation must 'continue in tandem' with resolving tariff issues. Malaysia is the current chair of the Association of South-east Asian Nations (Asean). Also at the conference, representatives of the Asean Taxonomy Board (ATB) made the case that enhancement of the region's eligibility definitions for sustainable finance continues apace. Mardini Haji Eddie, current ATB chair and deputy managing director for monetary operations, development and international at Brunei's central bank, gave insight into a new digital tool provided by ATB to help map activities across different taxonomies. A NEWSLETTER FOR YOU Friday, 12.30 pm ESG Insights An exclusive weekly report on the latest environmental, social and governance issues. Sign Up Sign Up Eugene Wong, chief executive of the Sustainable Finance Institute Asia (SFIA), the think tank that hosts the ATB, said that Asean intends to hold the line as a vocal leader on sustainable finance. The common message: Sustainability and sustainable finance in South-east Asia are still very much in business. Tariffs and unpredictable policy from the US threaten to dampen business investment and consumer demand around the world, with fears of a global recession. An economic slowdown could prompt governments to provide fiscal support. If so, fiscal responses in South-east Asia should include investments and spending in sustainable development to ensure that policy support goes towards strengthening the region's economies for future conditions. This could be the time to step up investments in climate adaptation and resilience. South-east Asia has an elevated exposure to climate risk, several studies have shown. For instance, the Philippines and Indonesia consistently top the World Risk Index, which measures exposure and vulnerability to natural disasters. Of the 10 Asean member states, only three – Brunei, Laos and Singapore – have less risk than the global median in the index. A working paper by the Asian Development Bank estimates that economic losses due to climate change in 2100 in Brunei, Malaysia, Singapore and Thailand could be more than 15 per cent of GDP under a low-emissions scenario and more than 55 per cent of GDP under a high-emissions scenario. Despite those risks, adaptation spending in the region is sorely lacking. The strategic use of public funds to finance and catalyse investments in climate adaptation and resilience can address several needs at the same time. There is also an opportunity to accelerate the development of nature financing in the region, which is rich in natural resources and is highly dependent on agriculture and mining. Protecting and improving the resilience of the region's natural capital is a sound long-term investment. As SFIA's Wong also highlighted, addressing social development goals should also be on the agenda. When times are tough, supporting and uplifting the more vulnerable parts of society aren't merely humane policies, they're also good economic ones. But for all the positive messaging that South-east Asia is sending out, bold words must be backed by bold action. The region's governments need to commit to clear national climate targets and strategies, and apply those ambitions through credible policies. To date, Singapore is the only South-east Asian country that has submitted its 2035 National Determined Contribution (NDC) under the requirements of the Paris Agreement. The rest of South-east Asia will have to demonstrate their seriousness in dealing with climate change when they submit theirs. Across borders, greater regional collaboration on energy transition issues – including the Asean power grid and carbon market development – will help to improve impact and attract capital at larger scales. In burgeoning areas of sustainable finance, including nature and social financing, the markets need more public-private efforts to develop financing taxonomies and pathways that can enable buyers and sellers to transact with confidence. Every cloud has a silver lining, and every crisis has its opportunities. Played right, the current storm could set South-east Asia on a more sustainable course for the future. Sustainable investing Sembcorp's renewables prospects earn 'buy' calls Sembcorp Industries' performance as a renewables player is helping the company to attract attention from analysts. Goldman Sachs has just initiated coverage on the Singapore-listed stock with a 'buy' recommendation and a target price of S$8.40, representing a premium of 28 per cent above the May 13 closing price of S$6.57. DBS also has a 'buy' call on the stock, and HSBC has picked it as a top defensive play amid US tariffs. Sembcorp, whose net profit rose 7 per cent in 2024 to S$1 billion, has a diversified portfolio, which the analysts like. That diversification allows Sembcorp to buffer headwinds in China, where increasing curtailment – forced reductions in power generation due to oversupply – has hit returns. At the same time, Sembcorp is in markets with favourable dynamics such as India, the Middle East, the Philippines and the United Kingdom, Goldman Sachs says. At home, Sembcorp also holds a strong position in the Singapore power generation and natural gas import markets. The growth is supported by expectations of stable income due to long-term power purchase agreements. The analysts estimate that about 70 per cent of profits in the next few years could come from fixed-return contracts. To further sweeten the pie, there is potential for one-off gains from selling assets given that capital recycling is a stated strategy for Sembcorp. Investors in Sembcorp have done well so far this year. As at end-April, Sembcorp shares gained 19.6 per cent, outperforming a 1.2 per cent increase in the Straits Times Index over the same period. Other ESG reads
Business Times
11-05-2025
- Business
- Business Times
Asean's climate commitment still intact amid geopolitical, economic uncertainty
[SINGAPORE] While sustainability has taken a backseat globally in light of ongoing geopolitical and economic uncertainties, this could provide an opportunity for Asean to play a leading role in climate action, said Eugene Wong, chief executive officer of the Sustainable Finance Institute of Asia (SFIA), which is host of the Asean Taxonomy Board. In fact, current Asean chair Malaysia's public reaffirmation of the need to continue regional cooperation on climate shows that the commitment is still intact. During the recent sustainability-focused Ecosperity conference organised by Temasek, the country's Natural Resources and Environmental Sustainability Minister Nik Nazmi Nik Ahmad said that there is an urgent need to protect South-east Asia's populations and coastal cities, given the region's vulnerability to extreme weather events. 'We must transition while safeguarding livelihoods. We must ensure no one is left behind. We must ensure development is climate-compatible. All of these must continue to be pursued, regardless if we end up with 24 per cent or 10 per cent, or as we all live in hope, 0 per cent tariffs,' he said. 'While we remain committed to resolving the tariff issue through negotiation, both on a bilateral and regional basis, the climate cooperation agenda must continue in tandem,' he added. Slightly more than a month ago, global markets roiled after United States President Donald Trump's imposition of a blanket tariff rate of 10 per cent on all countries. About two weeks later, solar exporters from South-east Asia were hit again with duties as high as over 3,500 per cent on their products – an outcome of a process that started under the previous administration under Joe Biden. A NEWSLETTER FOR YOU Friday, 12.30 pm ESG Insights An exclusive weekly report on the latest environmental, social and governance issues. Sign Up Sign Up Coupled with geopolitical and security concerns over the Russia-Ukraine war, as well as the recent India-Pakistan conflict, it is unavoidable that investment flows and national resources are re-allocated away from climate to address these issues. Despite these challenges, Asean has been quite resolute on the need to continue pushing for sustainability, said Wong, who was speaking with The Business Times. 'Asean, also in the last five years, has become quite a vocal leader in sustainable finance globally. So the question is, can we hold the line? We must, and we intend to,' he added. Wong also said that while short-term survival is top of mind for governments and businesses, sustainability has not been forgotten, but merely reprioritised. 'The more tariffs come and cause economic hardship, the more social equality is going to be important. So definitely, the sustainability agenda is still there. It's been reprioritised. It's going to come back at some point,' he said. Asean regulatory developments As a region made up of mostly emerging markets, South-east Asia has typically faced a dearth of much-needed investments towards green and energy transition projects that could support its decarbonisation. The focus of the region's regulators is to develop a more enabling environment for private investments by coming up with the Asean taxonomy and the Asean transition finance guidance frameworks. The Asean taxonomy – which is a regional classification system that defines what economic activities qualify for sustainable financing – is now in its third version, with plans for a fourth to be finalised by the end of this year. The Asean Taxonomy Board, along with SFIA, recently developed a digital tool known as Accept, which aims to provide a side-by-side comparison of how a particular economic activity is classified under various taxonomies. Designed to provide equivalence between taxonomies, the platform would help to reduce fragmentation by using the Asean taxonomy as a common language, while still allowing each Asean member state to address its own national needs, said Mardini Haji Eddie, who is chair of the Asean Taxonomy Board, as well as the deputy managing director for monetary operations, development and international at Brunei's central bank. 'For investors and financiers, the challenge is that if they operate regionally or globally, they have to deal with different taxonomies and determine how they deal with each classification, under those taxonomies. But if they use the Asean taxonomy, and also through Accept, they only have to determine their preferences under the Asean taxonomy, and Accept will translate any taxonomy classification into the equivalent Asean taxonomy classification,' said Mardini, who was also speaking to BT in the same interview with Wong. When asked if the Net-Zero Banking Alliance's recent decision to replace its 1.5 deg C climate target to 'well below 2 deg C' was a vindication of Asean's earlier decision to have some flexibility baked into its taxonomy and transition finance framework, Wong said that there was a need for Asean to be realistic given the economic development levels of some of its member states. The region's regulators had previously been criticised for designing the Asean taxonomy and transition finance guidance as a tiered system, in which the highest tier sets the criteria and threshold for economic activities aligned to a 1.5 deg C pathway, while the lower tiers are not on that gold standard trajectory. The region's regulators had previously been criticised for designing the Asean taxonomy and transition finance guidance as a tiered system, in which the highest tier sets the criteria and threshold for economic activities aligned to a 1.5 deg C pathway, while the lower tiers are not on that gold-standard trajectory. But while some corporates have the ability and resources to pursue decarbonisation plans aligned with the 1.5 deg C pathway, most of the 71 million micro, small and medium-sized enterprises in the region do not, said Wong. 'We know that it's not possible because our countries have different starting points. We are not Europe, and we will cause social and economic dislocations if we just go for 1.5 deg C,' he said. 'Transition is a balance between ambition and reality... How can we get the reality to fit with the ambition? There is this concept of paradox of ambition. If you actually push people to do something that's too ambitious, they'll just give up, or you won't succeed. So you might as well be practical about it. You might as well try and have a very realistic pathway on how you can achieve what you want to do,' he added. The tiered approach also reflects one of the foundational principles of the Paris Agreement, known as the Common but Differentiated Responsibilities and Respective Capabilities principle, said Wong. This means that while all countries share the obligation to address climate change, their levels of responsibility and capacity to do so differ based on their historical emissions and economic development.
Straits Times
11-05-2025
- Business
- Straits Times
Lack of talent could put a damper on Singapore's growing carbon services sector
Panellists (from left) WWF Global Lead, Carbon Finance and Markets Taskforce Rueban Manokara, BeZero Carbon CEO Tommy Ricketts, Enterprise Singapore director of trade Ivan Tan and moderator Daniel Lee during the GenZero Climate Summit Insights on May 5. ST PHOTO: CHONG JUN LIANG SINGAPORE – Singapore's carbon services sector is gaining traction with new initiatives and research projects, but a shortage of talent could hinder the growth of the new sector in the long run. One research project explores whether carbon credits can be generated by tapping the carbon absorption power of volcanic rocks. The aim is to find out how much carbon dioxide crushed volcanic rocks can absorb when scattered over a rice paddy field in South-west China, and what the economic feasibility of creating such credits is, said Ms Zhang Yiwen, a PhD student at the NTU Asian School of the Environment. The lithosphere – or rocky parts of earth – can store carbon for much longer periods than forests. Currently, carbon credits are typically generated through nature conservation efforts or technological solutions such as clean cookstoves. The research by an inter-university team – led by Professor Simon Redfern, dean of the NTU College of Science – is part of the growing carbon services sector, identified in 2021 by the Government as an engine of growth for the economy. Efforts to strengthen the talent pipeline in this area are also gaining momentum. At the Ecosperity sustainability conference over the past week, NUS announced that it will invest $10 million in a campus-wide initiative that will push for research and education on sustainability. Under this initiative is the NUS Sustainability Academy, which will offer a new Professional Certificate in Carbon Services and Trading. On May 5, SkillsFuture Singapore also released a national framework, outlining the career opportunities and skills needed in the carbon services sector. This move to expand the talent pool comes amid growth in the sector, with Singapore now home to more than 150 firms in the young carbon services sector – double the number from 2021. The ecosystem includes local and global players such as sustainability advisors, carbon project developers, carbon credit traders, firms that conduct greenhouse gas emissions monitoring, reporting and verification for companies and carbon projects. 'Despite the uncertain global outlook, the ongoing and urgent need to mitigate climate change will continue to drive growth opportunities in sustainability and the green economy,' the Economic Development Board (EDB) and Enterprise Singapore told The Straits Times in a joint statement. 'Many Asean countries have also announced net-zero ambitions and will need the help of carbon services firms to chart their decarbonisation pathways,' they added. However, one major obstacle that could prevent the local sector from sustaining its growth is the lack of talent over time. Talent doesn't come 'off the shelf' During a panel discussion on May 5, Mr Tommy Ricketts, chief executive of carbon ratings agency BeZero Carbon, said it is rare to hire someone 'off the shelf' with all the know-how in carbon markets – environmental science, finance and policy. 'Off the shelf as a new recruit? Very hard. Doesn't really exist anywhere. Off the shelf with experience? Very expensive,' he added. Speaking at the GenZero Climate Summit Insights panel on talent, Mr Ricketts noted that among the professionals in the carbon markets sector here, local and new talent make up the lowest percentage. Also on the panel was Mr Ivan Tan, director of trade at Enterprise Singapore. He said that when the sector started taking shape in 2019 and 2020, the authorities recognised the need to remain very open to global talent to build up the industry. For Mr Alvin Lim, chief executive of local carbon project developer Climate Bridge International, the challenge goes beyond qualifications. He looks for three things in a potential hire: First, the person needs to demonstrate interest in the carbon markets by reading avidly, taking courses and doing internships. This will be reflected in the depth of knowledge, including a good grasp of project types, UN rules on carbon trading, and carbon market policies in other countries. Second, the person must be intellectually curious, he said. It is the third trait that Mr Lim has been struggling to find in local job-seekers after months of interviews – the grit and willingness to work in remote countries to oversee and monitor carbon projects. Mr Alvin Lim, 39, CEO of Climate Bridge International. ST PHOTO: KEVIN LIM Most of the projects Singapore is expected to approve are likely to be hosted in the Global South, which includes countries in Latin America, Africa and South-east Asia. 'Some people see this as an adventure and others see this as a hardship trip. What if I tell them: 'Can you please go to Ghana and live there for a month and help us monitor the project?' And what if you need to travel 25 per cent of the year? 'And this is not even the capital of Ghana, it could be two hours away in the middle of nowhere,' Mr Lim said. 'We are looking for candidates with grit and the ability to be resourceful in finding solutions, especially when operating in unfamiliar environments with limited support.' Mr Izzat Hamzah from global climate solutions provider 3Degrees believes that sustainability is less of a domain and more of a lens – a perspective that someone aspiring to join the climate space should adopt. It is about having core expertise, whether in economics, law, engineering or computer science, and applying those skills in sustainability, he said. A sustainability professional should be a 'Jack of all trades, a master of some', said the Asia-Pacific lead for trading and origination of environmental commodities. 'When folks ask how they can build a career in sustainability, they miss the point. The real question is: 'How do I develop deep expertise in my current profession – be it law or engineering – and then gear it to sustainability?' One example is Mr Michael Alexander, who majored in mathematical finance, and is now a research analyst at the NUS Sustainable and Green Finance Institute . One example is Mr Michael Alexander, who majored in mathematical finance, and is now a research analyst at the NUS Sustainable and Green Finance Institute. The Indonesian, who has been in Singapore for 10 years, decided to stay in the sector after visiting a peatland forest conservation and restoration project in Kalimantan. After seeing the carbon project's impact on biodiversity and in convincing the local community to avoid logging, he wanted more of such efforts to be given better access to funding. Said Mr Alexander: 'I became very troubled by the fact that the carbon market seemed unable to provide fair financing to good projects due to the general pessimism of the market. This sparked my desire to work towards fairer carbon market structures.' Find out more about climate change and how it could affect you on the ST microsite here.
Yahoo
09-05-2025
- Business
- Yahoo
Bill Gates Says Rich Countries 'Owe It To The World' To Get Themselves Down To Net Zero Emissions
Bill Gates, Microsoft Corp. (NASDAQ:MSFT) co-founder and one of the most vocal advocates for large-scale climate solutions, is urging wealthy nations to lead the charge in achieving net-zero emissions, highlighting they have a global responsibility. Speaking in Singapore at Temasek's flagship sustainability event, Ecosperity, Gates called for impactful investments in innovation to address the climate crisis head-on. Trending: Shark Tank's Kevin O'Leary called Missing Ring his biggest mistake — Don't repeat history—invest in RYSE at just $1.90/share. What Happened: During a fireside chat with Singapore's Ambassador for Climate Action, Ravi Menon, Gates stressed that while it may not be essential for every nation in the world to reach "absolute zero" emissions, rich countries that have access to the resources must do so. "There are levels of emissions that are small enough that the temperature worsening actually is not a problem," he said. He also admitted that expecting the whole world to achieve net zero by 2050 is "not realistic" at this point, according to NBC. Why It Matters: According to the United Nations, Net zero means "cutting carbon emissions to a small amount of residual emissions that can be absorbed and durably stored by nature and other carbon dioxide removal measures, leaving zero in the atmosphere." 25/share. Gates emphasized that rich nations should set examples by reaching net zero, aiding the world stay on track with the Paris Agreement's target of limiting global warming to 1.5°C. He mentioned that innovation is crucial to achieving these goals, but cited challenges like securing risk capital. At the same conference, where he was present as the founder of founder of Breakthrough Energy, Gates also shared his belief that even though there is a "little less cooperation going on", referring to President Donald Trump's climate rollbacks, he does not "think that's a permanent thing." Read Next: Invest Where It Hurts — And Help Millions Heal: Invest in Cytonics and help disrupt a $390B Big Pharma stronghold. Deloitte's fastest-growing software company partners with Amazon, Walmart & Target – Many are rushing to grab 4,000 of its pre-IPO shares for just $0.30/share! Photo courtesy: Alexandros Michailidis / Send To MSN: Send to MSN Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Bill Gates Says Rich Countries 'Owe It To The World' To Get Themselves Down To Net Zero Emissions originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Times
07-05-2025
- Business
- Business Times
Singapore's blended finance initiative to set up dedicated office to support Asia's decarbonisation
[SINGAPORE] The Republic's blended finance initiative aimed at supporting Asia's decarbonisation will be setting up an office with a dedicated management team to oversee the deployment of capital mobilised under this fund, said Chia Der Jiun, managing director of the Monetary Authority of Singapore (MAS). This includes the US$500 million concessional capital the Singapore government had previously committed, as well as other sources of financing from both public and private partners of the initiative. 'The office will continue to work closely with asset managers, banks, and commercial and concessional investors, to promote innovative blended finance solutions for sustainable infrastructure in the region,' said Chia, who was speaking on Wednesday (May 7) at sustainability conference Ecosperity organised by Temasek. Known as Financing Asia's Transition Partnerships, the blended finance initiative – launched at the 2023 United Nations' climate change conference in Dubai – has a target of mobilising US$5 billion by bringing together both public and private-sector partners to de-risk and fund transition and marginally bankable green projects in Asia. Blended finance programmes feature a mix of grants and concessional loans designed to lower the cost of capital, thereby attracting more commercial capital. The platform had set up three funds to support three focus areas of green and transition financing since it was launched. A NEWSLETTER FOR YOU Friday, 12.30 pm ESG Insights An exclusive weekly report on the latest environmental, social and governance issues. Sign Up Sign Up The first one is a green investment partnership between MAS, Singapore investment company Temasek, the Allied Climate Partners and the World Bank's International Finance Corporation. Managed by debt financing platform Pentagreen Capital, this fund looks at investing in mature green technologies such as renewable energy. Chia said on Wednesday that this fund will be ready to begin deploying capital in the coming months. The second fund is a partnership between the Asian Development Bank and the Global Energy Alliance for People and Planet to finance Asia's energy transition. The third fund focuses on providing debt financing to companies looking to decarbonise their businesses, including projects in hard-to-abate sectors, technology solutions for the low-carbon transformation and industrial opportunities.
