AmBank Group’s Post

At The Edge Malaysia ESG Forum, with the theme Financing for a Green Future, I shared with the audience that expected tightening of global financing conditions will see the estimated SDG financing gap reaching USD4.3 trillion/year from 2020-2025. My key concern are the MSMEs, whose key challenges in embracing ESG revolve around cost, complexity, confusion & competing priorities (e.g., post-pandemic recovery means ‘survival’ always wins over ‘sustainability’) I, therefore, invited the forum participants to extend their support not just on building the MSMEs’ ESG capacity, but also in promoting the ‘OPPORTUNITY NARRATIVE’ to them. This is because MSMEs represent 97.4% of all registered businesses (in 2021), & 47.8% of total employment in Malaysia. Hence, it is quite crucial for us to leverage on their numbers to not just move the nation’s ESG needle, but also to generate the much-needed broad-based growth that the nation needs. This narrative is premised on significant fresh opportunities in the green economy in Southeast Asia, valued at up to USD200 billion by 2030. Long-term & sustainable value creation provide compelling reasons for manufacturers to lean into the ESG landscape & accelerate their ESG efforts. To that end, I invited the FI’s, DFI’s & other industries to consider allocating resources to SMEs, manufacturers & exporters focused on green manufacturing initiatives, & areas such as sectoral decarbonisation, electric mobility, hydrogen energy, large-scale carbon capture, utilisation & storage (CCUS), as well as technologies on circular economy & green infrastructure. All these, and more, will be part of our New Industrial Master Plan 2030 (NIMP2030), which looks to transform our manufacturing sector from its very core, by advancing economic complexity; embracing technology & digital transformation; striving for a net-zero future & decarbonizing our economy & ensuring economic security & inclusivity. While embracing ESG & SDG goals are our collective moral duty, what is equally key is to ensure a JUST & GRADUAL TRANSITION for MSMEs, particularly as banks increasingly embed ESG considerations into their lending risk metrics. I also shared that MITI is finalizing our National Industry ESG framework (i-ESG) for the Manufacturing Sector, to be launched by end-2023. It sets a clear ESG transition plan & comprises 4 key components – standards, financial support & incentives, capacity building & market mechanisms. It provides clear guidelines & enablers for all manufacturing companies, particularly MSMEs, to embrace ESG. Our target is to have 60% of MSMEs in the manufacturing sector to produce some form of sustainability reporting by 2030. The success of NIMP2030 is crucial for our nation’s sustainable growth. We can either be forced to ‘go home’ by global headwinds, or we can go big on serious execution of reforms in our manufacturing sector. MITI has chosen to go BIG! And we look forward to everyone’s support in this journey.

In a recent article in The Edge Malaysia, Dato' Fad'l Mohamed describes how investment banks are strategically positioned in helping corporate Malaysia achieve national sustainability goals. For example, Maybank's dedicated Sustainable Finance Team helps guide clients end-to-end; from structuring transactions to connecting issuers to ESG investors, and assisting in setting up sustainable frameworks. In addition, the team also focuses on helping mid-cap companies by increasing their awareness and readiness to operationalise sustainability. Mid-caps may find it a practical challenge to prioritise sustainability considerations within their operations due to insufficient resources. Click for more on this story including Maybank's recently launched Transition Finance Framework aimed at leading the shift towards a net-zero economy by funding the greening of brown, hard-to-abate sectors. #ESG #sustainablefinance #MaybankIBG #investmentbanking #transitionfinance Dato’ Fad'l Mohamed Valerie Ng https://lnkd.in/geWNhWZZ

In this new reality of climate change, the sooner businesses prioritise sustainability actions, the better prepared they will be to manage risks and capture new growth opportunities. Maybank has been partnering businesses on decarbonising, mobilising RM53 billion of sustainable financing from 2021 to end September 2023, on track in meeting the group’s target of RM80 billion by 2025. While large enterprises are well-resourced to execute their transition to net zero, many mid-cap and smaller companies are struggling to get to the starting point. Gregory Seow, Head of Global Banking, Maybank Singapore says, “In tandem with our M25+ goals, we are also focused on serving mid-cap champions. They are underserved, poised for high growth being the key drivers of ASEAN economies.”   Read more about how Maybank can support businesses in sustainable including transition financing - https://lnkd.in/eRbYHYUF   #HumanisingFinancialServices #Decarbonisation #NetZero  

The SEC's recent attention has been drawn to the surging popularity of ESG Investing, leading to their issuance of subpoenas to multiple asset managers in relation with their ESG investments. This regulatory crackdown has emerged due to concerns about the transparency of ESG disclosures. In response to the need to facilitate comprehensive disclosures, Bursa Malaysia has collaborated with the London Stock Exchange Group to introduce the Centralised Sustainability Intelligence (CSI) Platform. Functioning as a repository for ESG disclosures, this platform facilitates streamlined reporting and bolsters the credibility of the provided data.   A notable global shift towards environmentally conscious economies is also evident, exemplified by Vietnam's endeavour to establish a domestic carbon market. While contemplating integration into the international market, Singapore and Chile have already taken strides by signing a MOU to establish a collaborative carbon market in alignment with the Paris Agreement. This emphasis on carbon reduction is not confined to nations alone; even SMEs are joining in on the action. Dyna-Mac Engineering Services Pte Ltd, a company listed on SGX and recipient of OCBC's inaugural SME sustainability-linked loan, has entered a partnership with BW Offshore Holdings to advance carbon capture and storage (CCS) projects, underlining the escalating commitment of both countries and industries toward sustainable practices. Subscribe to our newsletter for the full consolidation of this week’s global ESG headlines: https://bit.ly/40Wyl5P Top ESG stories from this week include:    Singapore 🇸🇬     🌱 Singapore, Chile sign MOU for carbon markets, pricing collaboration (August 15)  https://bit.ly/3E3qeLj  🌱Dyna-Mac signs MOU with BW Offshore to pursue global carbon capture and storage projects (August 16)  https://bit.ly/3sbZc1N     Asia 🌏  🌱 Vietnam pushes for carbon market development (August 12)  https://bit.ly/3DY5PaG  🌱Accelerating and digitalising ESG with Bursa Malaysia’s Centralised Sustainability Intelligence Platform (August 14)  https://bit.ly/3DUM7g7     Global 🌎     🌱SEC lawyers subpoena fund managers over ESG disclosures (August 15)  https://bit.ly/3sdsWvi  🌱Two-thirds of UK corporate carbon emissions not covered by reduction target: Report (August 10)  https://bit.ly/3YzLUs0  🌱 Sustainable Bond Proceeds Disproportionately Allocated to Climate Mitigation over Adaptation: Fitch (August 10)  https://bit.ly/3OArjPK     #ESG #Sustainablefinance #STACSESGFinanceWeekly Ray Ferguson | Benjamin Soh | Sharon Yuen | David Teo | Jin Ser | Thanda Aye (Tracy) | Sheena Ang | Kimberly Lee | Cleo Tan | Benjamin Tan | Grace Lim   

QUESTION: 1-Can Maybank manage the greater risk from this: "Efforts are being directed to expedite venture capital investments in high-risk, early-stage energy ventures........." 2-What exactly is "sustainable financing", and was there ever a time when financing was not "sustainable" except of course when debt could not be serviced? 3-As with (1) above how will Maybank manage the highr level of risk from " boosting the energy sector by attracting private investments, including international and domestic funds and venture capital, by fast-tracking the use of financial instruments that support sustainability, like green bonds and sukuk, and blended finance structures". Hint: Green bonds, sukuk, and blended finance sturctures are viable if and only if there are good, strong steady cashflows.

The recent Building the Future ESG Conference 2023 brings together key industry players in one room to discuss the Environment, Social, and Governance (ESG) and its significance to business opportunities. One key takeaway is that the real estate sector is being encouraged to perceive the ESG agenda not merely as a mandatory or promotional endeavor, but as a crucial element for creating value within their business for risk mitigation and innovation. In addition to traditional bank loans, venture capital can assume a vital function in advancing green lending and fostering sustainable development in Malaysia's property market. SMEs in Malaysia are actively promoting the need for enhanced funding of RM2 billion to bolster their efforts in embracing automation and digitalization. Furthermore, The SME Association of Malaysia emphasizes business strategies aligned with ESG principles as means to improve Malaysia's standing in the Trafficking in Persons (TIP) Report published by the US State Department. ESG issues are gaining global importance and there is a need for a significant investment to enhance renewable energy capacity and achieve net-zero emissions in business. The government is working on legislation to establish climate change mitigation and energy conservation frameworks. Alliance Bank and IJM Land have formed a partnership to encourage the widespread acceptance of eco-friendly properties. Meanwhile, Lagenda Properties has been selected as a component in the FTSE4GOOD and F4GBMS Indices, recognizing its commitment to sustainable and socially responsible practices.   Do watch the video for more details on this week’s ESG updates! https://lnkd.in/geHn8Zu8   #esg #renewableenergy #greenbuildings #sustainability #roadmaps #frameworks #realestate #solarplant #datacentre #industrialparks #townships #healthcare #sme #esginvestments #greeninvestments #greeneconomy