The Monetary Authority of Singapore (MAS) and Singapore Exchange (SGX Group) have launched a simplified ESG disclosure platform for listed companies.
- The ESGenome platform incorporates globally recognised ESG metrics to generate customisable reports that satisfy investors’ criteria.
- As part of MAS’ Project Greenprint, ESGenome represents Singapore’s ambition of becoming a hub for green finance in Asia.
- Improvements in data transparency will help Singapore attract global investment that could be used to finance its green transition.
Inconsistent data quality and lack of transparency are considered major challenges when applying ESG metrics to sustainable investment decisions. A new disclosure platform has launched in Singapore, sponsored by the national regulator and national exchange, with the aim of simplifying the process for the country’s publically listed companies.
The platform, dubbed ESGenome, will be operated under a Software-as-a-Service (SaaS) model by UK-based World Wide Generation (WWG). The fintech firm will provide its G17Eco solution, which provides tracking and reporting capabilities for ESG metrics, as defined by established global sustainability standards.
Michael Syn, senior managing director at SGX Group said, “ESGenome is designed to capture corporate sustainability disclosures in a simple and effective manner, useful to investors and the broader capital market ecosystem. We are optimistic that by being frontrunners in ESG data disclosure via ESGenome, our listed companies will be in a better position to raise capital and attract international investors who are actively looking for leading ESG firms.”
Helping solve ESG reporting dilemma for Singapore’s listed companies
A selection of 27 core ESG metrics were chosen to serve as a baseline for company reports generated through ESGenome, each of which is linked to globally recognised standards and frameworks including the Global Reporting Initiative (GRI), the Sustainable Development Goals (SDGs) and the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD).
The platform also offers companies the ability to report on 3,000 additional ESG metrics that are similarly aligned, as well as the opportunity to create their own custom metrics. Through ESGenome’s simplified data collection process, users are able to build datasets that provide consistent, comparable and structured information.
SGX says that this approach will help companies become more visible to investors, streamlining their access to green capital by satisfying the increasingly demanding reporting requirements of shareholders.
Project Greenprint details Singapore’s Green Fintech ambitions
The Monetary Authority of Singapore (MAS) is banking on two growing trends, green finance and financial technology (fintech), in its efforts to attract more global investment.
A set of technology and data driven initiatives, known as Project Greenprint, were launched in December 2020 with the aim of promoting a green financial system in Singapore. Project Greenprint’s three main objectives are to mobilise capital, monitor commitment and measure impact.
The project will be implemented via four different platforms:
- ESG Disclosure Portal – This refers to ESGenome, which has launched its pilot phase in 2022. The platform will later be updated to include both regulatory and voluntary disclosure capabilities for government agencies and the private sector.
- Data Orchestrator – A network of data platforms serving as trusted data sources.
- ESG Registries – A blockchain based solution for establishing trust and verifying the source of data uploaded by companies into data sources.
- Green Marketplace – A marketplace for connecting green technology providers with investors, financial institutions and corporate partners.
Project Greenprint highlights Singapore’s goal of becoming a green finance hub in Asia. In August 2022, this ambition was further demonstrated by the MAS’ announcement that the country had raised $1.75 million through its inaugural green bond.
MAS, however, recognises the need for transition finance, given the scale of hard-to-abate industries established within the region. While green finance issuance had reached $800 billion in 2021, only $4.4 billion worth of transition bonds had been issued globally within the same year.
Improving disclosure procedures for ESG metrics and adding transparency into the sustainable investing process will certainly help Singapore in advancing its ambitions. Adding double materiality assessments to ESGenome could add another level of transparency, providing even greater opportunities for attracting impact investment.