Whitepapervault Com

Sustainable Finance White Papers Working Committee

Development Prepared by: The Working Groups of the ASEAN Working Committee on Capital Market Development and the ASEAN Capital Markets Forum Joint Sustainable Finance Working Group’s Industry Advisory Panel. Industry Advisory Panel Convener Contents FOREWORD LIST OF IAP MEMBERS WHITE PAPERS • Taxonomy • ASEAN Transition Pathway • Sustainability Disclosures and Reporting • Strengthening Demand and Supply FOREWORD The ASEAN Working Committee on Capital Market Development (WC-CMD) and the ASEAN Capital Markets Forum (ACMF) have made supporting the ASEAN sustainability goals a key agenda. To this end, they have established the WC-CMD- ACMF Joint Sustainable Finance Working Group (JSFWG) to further the role of ASEAN capital markets in orienting capital to the sustainability agenda. The JSFWG coordinates the sustainable finance agenda for WC-CMD and ACMF, including the implementation of the recommendations in the WC-CMD Report on Promoting Sustainable Finance in ASEAN (Report) and the ACMF Roadmap for ASEAN Sustainable Capital Markets (Roadmap). The Report and the Roadmap are complementary documents developed by WC-CMD and ACMF respectively to enable the capital markets to support sustainability for the real economy. The 16 Recommendations in the Report and the 15 Key Recommendations in the Roadmap are geared towards creating a Sustainable Finance Ecosystem for ASEAN. This ecosystem is built on three pillars: • An ASEAN Taxonomy to serve as a common language; • Transition Finance Standards to enable financing for credible yet realistic transitions in the region; and • Disclosures to support informed decision making. The three pillars will enable demand and supply for sustainable finance to grow and create a virtuous cycle. Recognising the importance of involving market players in the development of their policies and initiatives, the WC-CMD and ACMF set up the JSFWG Industry Advisory Panel (IAP) as the core industry interaction point, to support the efforts of the JSFWG. The IAP is aimed at engaging with and facilitating feedback from the private sector on the JSFWG’s sustainable finance agenda and initiatives, while helping WC-CMD and ACMF better understand the views, ideas and needs of the private sector. The IAP was established in 2021 under the auspices of the JSFWG and comprised at its inception four IAP Working Groups (WG) – Taxonomy, Transition Standards, Disclosures, and Strengthening Demand and Supply for Sustainable Finance. At its inception, the IAP comprised 22 member organisations from the three main segments of the financial ecosystem – capital markets, banking and insurance, as well as other finance professionals and financial services providers such as legal, accounting and credit rating agencies. The members represented a mix of both regional and global interests. The Sustainable Finance Institute Asia (SFIA) was appointed as convener of the IAP. The IAP members had the responsibility of providing input to WC-CMD and ACMF at scheduled intervals, as well as on an as needed basis. In addition, they also provide information and feedback individually on a continuous basis. The IAP provides a forum for members to provide their independent diverse perspectives from across the financial sector in an open and professional manner. At its inception, each of the IAP WGs were requested by the WC-CMD and ACMF to develop White Papers on the private sector’s views, ideas and suggestions on their respective areas of focus. These White Papers were finalised in 2021, and encapsulated input provided to the JSFWG prior to their issuance. When discussing the policies and initiatives of their institutions and industries, and how those policies could affect the flow of credit and investment into ASEAN countries, members of the Transition Standards WG noted that: “Discussions between our working group members were always civil but also rigorous, transparent and open. We sought to bring that rigour to our updates to and engagements with the JSWG as we firmly believed that for our working group to have value, our views had to be grounded in reality, be open about uncertainty and explain the concerns and incentives based on how we saw them at the time. “ The Taxonomy WG and Transition Standards WG provided feedback throughout the development of the ASEAN Taxonomy for Sustainable Finance Version 1 (ASEAN Taxonomy Version 1) and this feedback was incorporated in their White Papers, and where appropriate, in Version 1 of the ASEAN Taxonomy for Sustainable Finance. It should be noted that discussions in these White Papers have since progressed, in some cases substantially, given the passage of time and the local, regional and global developments since their issuance. However, to showcase some of the original thinking of the IAP, WC-CMD, ACMF and the WGs are now making public the White Papers that were completed in 2021. The White Paper on Taxonomy reflects the views of the Taxonomy WG at the relevant time. The Taxonomy WG opined that: “ASEAN faces challenges in implementing a common regional classification due to the different levels of economic development of its members and their individual climate priorities. Therefore, the ASEAN version of Taxonomy needs to strike a balance among member states to give them confidence in their path to transition.” It is important to note that the Taxonomy WG represented one of many interaction points for the WC-CMD, ACMF and the ASEAN Taxonomy Board in the development of the ASEAN Taxonomy Version 1, which was developed after taking into consideration the input of stakeholders representing different interest groups. Transition is an imperative for ASEAN and both the Report and the Roadmap have highlighted the need for an orderly and just transition. Both the Taxonomy WG and the Transition Standards WG had taken this into consideration when preparing their White Papers.