Greening financial landscape cov
“The proposed specific requirements and expectations are to ensure that financial institutions strengthen the management of financial risks stemming from climate change to enhance the resilience of the financial sector against climate-related risks and to facilitate an orderly transition to a low-carbon economy,” Bank Negara says.
“In the same time period, Thailand and Vietnam lost half their mangrove forests, which has resulted in the loss of protection from tidal waves and storms for their coastal and urban areas,” he had noted, as reported in the JC3 Flagship Conference 2021 Rapporteur Report.To be sure, lenders in Malaysia are not taking this subject lightly, pledging billions in green financing over the next decade.
“Whilst we are cognisant of the significant ecological impact associated with such activities, to completely stop the financing without a transitional plan in place, would be irresponsible of us and could disrupt the economic progress of developing countries,” he adds. “As part of this commitment, we have already stopped providing any financing for new thermal coal mines and coal-fired power plants since 2021.
“At group level, HSBC has a thermal coal phase-out policy and is committed to phasing out thermal coal financing, in a net zero aligned timeline,” he says. RHB's Group managing director and CEO Datuk Khairussaleh Ramli tells StarBizWeek the lender is taking a “practical and phased approach” in winding down its current exposure, while playing a “nurturing role” in educating its customers to support clean energy, green activities and the transition to a low-carbon and climate resilient economy.
“They need to bring data to the fore and provide information about progress and outcomes as clients and society demand for more transparency,” he adds.group CEO Datuk Sulaiman Mohd Tahir says undeniably, gradual implementation is key when it comes to environmental, social, and corporate governance issues.
AMMB Holdings Bhd group CEO Datuk Sulaiman Mohd Tahir says undeniably, gradual implementation is key when it comes to environmental, social, and corporate governance issues. “While the requirement for sustainability related practices may seem daunting to some organisations, many of them do eventually realise the value created in adopting good ESG practices and pursuing responsible profit,” he says.
“Our view is that the growth of new sectors as well as the pace of adoption of sustainable practices among our existing clients will more than cover any impact arising from a reduction or exit from specific sectors or clients. RHB’s Khairussaleh says much more can be done especially in extending financing opportunities for newer technologies.