Biodiversity Outlook – What to expect for biodiversity in 2024?

We are anticipating increased focus in 2024 on biodiversity disclosure within corporate reporting.  This is in line with increased global action, legal reforms, shifts in mindset towards biodiversity conservation and nature-positive outcomes that we’re seeing at the moment.

Figure 1: Summary of global developments in the landscape of corporate biodiversity disclosures

The corporate reporting and regulatory landscape are undergoing significant changes, ushering in a new era of nature-related corporate disclosures. The Global Reporting Initiative (GRI) has introduced GRI 101: Biodiversity 2024, an updated reporting standard aimed at enhancing transparency on organisations’ biodiversity impacts. This update closely follows the release of the Taskforce on Nature-related Financial Disclosures (TNFD) late last year, which is a disclosure framework with over 320 organisations, including banks, asset managers and owners, financial institutions, publicly listed companies, and market intermediaries, committing to early adoption by fiscal year 2025.

The European Union (EU) is at the forefront of mandatory biodiversity reporting, with the establishment of the European Sustainability Reporting Standards (ESRS) E4 standards by the European Financial Reporting Advisory Group (EFRAG), that requires EU companies to report on biodiversity risks, opportunities, targets, and action plans.

Other upcoming developments to expect, include the emerging International Financial Reporting Standards (IFRS) developed by the International Sustainability Standards Board (ISSB). The ISSB has announced that there will be enhancements to their disclosure standards to include topics on biodiversity, like natural ecosystems, deforestation, and just transition.

Growing awareness within the investor and financial sectors highlights the significant reputational and legal risks associated with biodiversity loss in investment portfolios. This has led to a shift towards financial instruments prioritising biodiversity to achieve nature-positive outcomes and mitigate financial risks. The financial sector is anticipated to continue driving reporting and regulatory requirements for biodiversity disclosures to meet the increasing demand for transparency, credibility, and the prevention of greenwashing risks.

The intricate interconnectedness of nature and biodiversity can present a daunting challenge for companies to integrate these considerations into their business strategies. Recognising this initial trepidation, a shift is gaining momentum within the corporate landscape, evidenced by the proliferation of frameworks and guidance specifically designed to support a transition towards nature-positive outcomes. Furthermore, leading organisations like Business for Nature Coalition, World Business Council for Sustainable Development (WBCSD) and World Wildlife Fund (WWF) are spearheading the development of practical tools tailored to specific industries, and equipping businesses with the tools and knowledge needed to implement effective nature-positive strategies.

Adding further impetus to this positive trajectory is the burgeoning field of science-based Targets for Nature (SBTN). Leveraging SBTN will empower companies to establish quantifiable, achievable, and time-bound nature-related targets, grounded in science, that aligns with planetary boundaries and societal sustainability aspirations. In May 2023, 17 pioneering companies have piloted the first-ever science-based targets for nature, marking a significant advancement in understanding and implementing such targets, ahead of opening the target validation process later this year. As the pilot program will conclude in May 2024, the forthcoming report will offer valuable guidance and insights gleaned from participant companies’ successes and challenges in setting science-based targets.

Despite progress made, there remains a significant gap between rhetoric and reality. It is paramount to recognize that integrating biodiversity considerations within business strategies is not solely a matter of environmental responsibility; it holds tangible benefits. By embracing nature-positive practices, entities can unlock novel opportunities for growth and contribute meaningfully to the construction of a more sustainable future for all. We must seize the momentum generated by UN Biodiversity Conference (COP 15) and UN Climate Change Conference (COP 28), translating ambitious targets into concrete actions on the ground. Ultimately, collective action from governments, businesses, and individuals is essential to protect our planet’s biodiversity and ensure a prosperous future for all.

For 20 years, Paia has empowered local organisations to embark on their sustainability journeys. Leveraging our expertise in the sustainability space, we drive measurable improvements across organisations, helping achieve sustainability progress across E, S and G. With TCFD strategy and implementation being one of Paia’s key service lines, and our in-house environmental expertise, we are well-placed to support our clients with getting started on managing nature-related risks and opportunities. To delve deeper into TNFD disclosure reporting, we invite you to explore our insightful article, “TNFD, Explained”.

Get in touch with Paia for more information and insights on how we can support your organisation. If you would like to learn more about how to kickstart your nature strategy, you can reach out to us via




[1] European Sustainability Reporting Standards (ESRS) E4 standards

[2]  GRI 101: Biodiversity 2024

[3] International Sustainability Standards Board (ISSB)

[4] Paia Insights: “TNFD, Explained”.

[5]  Science-based Targets for Nature (SBTN)

[6] Taskforce on Nature-related Financial Disclosures (TNFD)

[7] UN Biodiversity Conference (COP 15)

[8] UN Climate Change Conference



Triple Bottom Line in Action: Singapore’s Business Response to Food Waste

By Angela Pang and Dawn Ng

Food waste continues to be one of the most under-recycled waste streams globally, and unfortunately, this trend holds true in Singapore[1]. The data released by The National Environment Agency (NEA) Singapore showed that the recycling rate of food waste stood at 18% in 2022[2]. Worryingly, this figure has remained static over the course of four years from 2019 to 2022. In contrast to this stagnation, Singapore has established ambitious plans to transform into a Zero Waste Nation. The Zero Waste Nation Master Plan outlines a goal of achieving an overall recycling rate of 70% across all waste streams and a recycling rate of 30% for domestic wastes by 2030[3].

Will Singapore be able to make such a leap in the span of only six years from now? The gap between the current recycling rate for food waste and the desired recycling rate seems daunting. This stagnation over the past years suggests that current initiatives may not be sufficient to meet the 2030 goals. There is argument for a more nuanced and comprehensive approach for businesses to be incentivised and supported for their effort to reduce food waste. This stems from the scale of the issue of food waste, along with the diverse sources and drivers across the food value chain that present opportunities for businesses to address the gaps for food waste recycling.


Graph of food waste recycling rate against the 2030 goals of overall and domestic recycling rate

    Figure 1: Graph of food waste recycling rate against the 2030 goals of overall and domestic recycling rate.

NEA Singapore has taken multiple initiatives to encourage responsible consumption through approaches such as the Food Waste Reduction Outreach Programme[4]. Launched in 2015, this programme aims to educate the public on making smart food purchases, practising proper storage and preparation methods to reduce food waste at source. Similarly, the “Food Waste? Don’t Waste!” pilot project executed in 2018 targeted communities to recycle their food waste by depositing them in food waste recycling bins located around residential blocks.

Even though progress has been made among consumers, more attention needs to be given towards businesses on the topic of managing their food waste. Based on NEA’s Food Segregation Roadmap, large commercial and industrial food waste generators are mandated to segregate their food waste for on-site or off-site treatment by 2024. This policy is a vital step which aligns with NEA’s prior initiative: “Food Waste Funding Scheme” in 2020. Aimed at supporting organisations in Singapore, this scheme subsidises the initial capital costs of food waste treatment[5]. Successful applicants will receive a maximum of S$100,000 to cover the costs for infrastructural adjustment and installation of food waste treatment systems as well as auxiliary equipment (e.g. bins, bin lifters, weighing mechanisms). The fund also addresses the collection, logistics, transportation, processing, and recycling costs to further solidify Singapore’s commitment to a more sustainable food waste management.

While the funding scheme highlights Singapore’s commitment to address the issue of food waste, it is not without its challenges. For instance, the funding payout is administered only after project installation and commencement of operation, which leaves Small and Medium Enterprises (SMEs) vulnerable without the necessary initial capital to begin a project. Following this, initiatives such as on-site food waste treatment necessitates a buffer period and may have a slow gestation phase before tangible results are observed. To put simply, these processes need time to become effective. This inevitably underscores a conspicuous gap in current food waste management strategies, where businesses are often left to their own devices in navigating the complexities to manage their food wastes.

Fortunately, businesses in Singapore have not remained passive towards the issue of food waste. Many have executed robust food waste management systems. This indicates a sign that companies recognise the importance of environmental stewardship, where corporate responsibilities extend beyond the conventional focus on profits and financial metrics. In Singapore, large food retailers and hospitality companies are one of the primary industries responsible for generating the bulk of food waste. Rather than being part of the problem, many of these organisations have started to align themselves with solutions. Several leading names such as NTUC FairPrice, Sheng Siong Group, Marina Bay Sands and Grand Hyatt Singapore began to resonate with NEA’s Food Segregation Roadmap, implementing initiatives showcasing their active commitment to reduce food waste.

For instance, NTUC FairPrice and Sheng Siong Group have been proactive in rolling out food waste reduction programs, which include optimising supply chain processes to minimise spoilage, promoting the sale of imperfect but perfectly edible produce, and recycling unsellable products into animal feed or compost[6],[7]. Similarly, Marina Bay Sands and Grand Hyatt Singapore have introduced innovative measures within their kitchens, such as employing smart technologies to track and analyse food waste and training staff on sustainable food preparation techniques[8],[9]. Refer to Figure 2 for detailed descriptions of their initiatives.

Food waste recycling and reduction initiatives by large food retailers and hospitality companies in Singapore.

Figure 2: Food waste recycling and reduction initiatives by large food retailers and hospitality companies in Singapore.

These initiatives highlight genuine business opportunities and an open window for businesses to begin or scale up current efforts to manage food waste. They not only comply with the forthcoming regulatory mandates by NEA but also demonstrate that it is possible to merge business objectives with ecological responsibility. By setting precedents and providing workable models, these food retailers and hospitality giants are laying the groundwork for a broader industry shift, offering evidence that environmental stewardship need not be at odds with commercial success.

Small and Medium Enterprises (SMEs) in Singapore are also increasingly taking the lead in pioneering initiatives that align with the nation’s vision of becoming a Zero-waste society. For example, Ento Industries[10] has adopted a novel approach to food waste by utilising the Black Soldier Fly. This ingenious method allows them to upcycle diverse food wastes into valuable feed ingredients for the agricultural sector. Similarly, Eco Wise[11] has made commendable advancements in recycling food waste from production plants. They transform by-products such as spent barley grains, soya residue, and excess milk powder from local food processors into enriching additives for poultry feed to be distributed throughout the Southeast Asia region. Beyond merely signalling a rising consciousness about food waste recycling, these endeavours by SMEs underscore the potential for businesses, regardless of size, to play a pivotal role in mitigating food waste.

The criticality of food waste is that it does not merely disappear, but persists to pose environmental impacts even after being disposed of. As food wastes in Singapore are directed to Waste-to-Energy Plants, the GHG released contributes to the accelerated warming of the planet, impacting weather patterns, ecosystem and human health. The slow progress of recycling rate for food waste over recent years indicates that more transformative measures should be considered to propel Singapore towards the goal of 70% overall recycling rate. The lessons learned from these pioneers and SMEs can guide other businesses and the government alike, fostering a collaborative environment in which both regulation and voluntary action work in harmony to turn the tide on food waste in Singapore. The alignment of these initiatives with NEA’s roadmap is an indication that the battle against food waste is gaining momentum, slowly transforming the food value chain from linear to circular, serving as a robust model for others to follow.



[1]United Nations (2022). Food Loss and Waste Reduction. [online] United Nations. Available at:

[2]National Environment Agency (NEA) (2022a).Waste Statistics and Overall Recycling. [online] Available at:

[3]National Environment Agency (NEA) (2021). Sustainable and Resource Efficient Singapore. [online] Available at:

[4]Move For Hunger (2015). The Environmental Impact of Food Waste | Move For Hunger. [online] Available at:

[5]National Environment Agency (NEA) (2022b). Food Waste Management Strategies. [online] Available at:

[6]Fair Price Group (2023). Here To Serve: Annual and Sustainability Report 2022 . [online] p.73. Available at:

[7]Sheng Siong Group Ltd. (2023). Shaping a Sustainable Future Together. [online] p.97. Available at:

[8]>Marina Bay Sands (2023). Responsible Business Highlights 2022. [online] p.9. Available at:

[9]Grand Hyatt Singapore (2022). Grand Hyatt Singapore Story on Sustainability and Innovation. pp.16-20. [online] Available at:

[10]Ento Industries (n.d.). Ento Industries. [online] Available at:

[11]ecoWise Holdings Limited (n.d.). ecoWise – Resource Recovery | 30 years of experiences with products & services. [online] ecoWise Holdings Ltd. Available at:

TNFD, Explained

Introduction to TNFD

The Task Force on Nature-related Financial Disclosures (TNFD) officially launched its disclosure recommendations and implementation guidance (hereby, the “TNFD Recommendations”) at the NY Climate Week NYC in September 2023. Following a two-year development process, the TNFD Recommendations are designed to bridge the relationship between nature, business, and financial capital. They aim to help shift capital flows to nature-positive outcomes and align businesses to global biodiversity goals such as the 30 by 30 initiative under the Kunming-Montreal Global Biodiversity Framework.

The TNFD Recommendations are a significant development in the landscape of reporting architecture, following the publication of International Sustainability Standards Board (ISSB) standards and the EU Sustainability Reporting Standards (ESRS) in 2023. Based on public statements of interest by the ISSB and ESRS to integrate TNFD Recommendations into these reporting standards, businesses can expect future regulatory compliance requirements to report on nature-related disclosures.

Building a business case for nature

Many businesses depend on natural capital and the ecosystem services it provides. With the present spotlight on reversing climate change impacts, it is crucial to note that nature loss and climate change are inseparable challenges. By seizing the opportunity to align to the TNFD Recommendations, businesses can benefit by actively managing current and growing nature-related risks alongside climate risk, complying to regulations, building sustainable value, and boosting stakeholder trust and confidence.

TNFD Framework

Inspired by the Task Force on Climate-related Financial Disclosures (TCFD), the TNFD Recommendations is centred around the same four core elements: Governance, Strategy, Risk Management, and Metrics and Targets. The final set of 14 disclosure recommendations aims to provide organisations with a risk management and disclosure framework for nature.


Figure 1 : Summary of disclosures under TNFD Recommendations


In recognition of the complexity, uncertainty, and importance of long-time horizons when dealing with nature, the TNFD has designed a model assessment approach (known as the LEAP approach) to support nature-related risk and opportunity assessment within corporates and financial institutions. The approach draws on existing assessment methodologies and frameworks, including the Natural Capital Protocol developed by the Capitals Coalition and the target setting methods developed by the Science Based Targets Network (SBTN).

To ascertain and evaluate an organisation’s nature-related issues, the LEAP approach recommends the following 4 steps:


Figure 2 : Summary of LEAP Approach under TNFD Recommendation


Businesses can take the first step in addressing nature loss by identifying and understanding their nature-related dependencies, impacts, risks, and opportunities. Companies should also start to consider relevant biodiversity metrics (such as land use, pollution, resource use, etc) to set a baseline, set targets, as well as to track and inform their progress in managing nature-related impacts and risks.

To further support businesses in assessing nature-related issues, TNFD has consolidated a comprehensive tools catalogue which provides an overview of sector-specific and biome-specific nature-related data tools available today.

Our outlook on TNFD

Both climate change and nature loss collectively contribute to the planetary crisis the world is facing today. As such, achieving net zero should not be the sole goal of the organisation – it is time to reach further and consider nature-positive outcomes.

With the publication of the TNFD disclosures, Paia foresees the potential for the TNFD framework to be adopted similarly to the TCFD and expects to see increasing expectations on nature-related disclosures amongst investors, financial institutions, and government bodies. As such, Paia seeks to stay ahead of forthcoming regulations on nature-related disclosures by keeping our clients informed and collaborating with them to ensure their preparedness.

With 20 years of experience in sustainability advisory, Paia has been instrumental in influencing local organisations to further their sustainability journeys. Paia leverages on our expertise in the sustainability space to drive and enhance the sustainability maturity of our clients. With TCFD strategy and implementation being one of Paia’s key service lines, we are well-placed to support our clients with getting started on managing nature-related risks and opportunities.

Get in touch with Paia for more information insights on how we can support your organization. If you would like to learn more about how to start reporting against the TNFD framework, you can reach out to us via




[1] Kunming-Montreal Global Biodiversity Framework

[2] Paia Insights: TCFD Demystified

[3] Recommendations of the TNFD

[4] TNFD: the LEAP approach

[5] TNFD Tools Catalogue: Nature-related tools aligned with TNFD’s LEAP approach

Demystifying the double materiality debate

By Valerie Phua and Teo Ying Ying

Reporting standards & materiality

Figure 1: Positions taken by major reporting standards on double materiality

Materiality is a concept at the heart of any sustainability strategy. Originally a term used in accounting and legal circles, materiality described issues that would be considered significant to a reasonable investor[i]. Within sustainability, the definition of materiality has been extended to describe issues of significant importance to not just investors, but to a company’s key stakeholders.

But opinions differ on who these key stakeholders should be, and the types of issues that should be considered material.

Double materiality has emerged as a concept at the heart of the debate between major reporting standards, which have different positions.

In this 10 minute read, we will ask:

  • What is double materiality, and what does double materiality mean in the context of a company’s sustainability strategy?
  • What positions have been taken by the major reporting standards?
  • What is at the heart of the debate across these standards?
  • What is the outlook for a global sustainability reporting landscape?

What is double materiality?

What is double materiality?

Figure 2: What is double materiality?

Double materiality implies duality and refers to the application of both financial and impact materiality.

Financial Materiality

Financial materiality focuses on how environmental, social and governance (ESG) issues impact a company, adopting an outside-in perspective. Within this approach, companies would ask themselves:

Themes: Questions to ask:
What risks are presented by this ESG issue or trend to my business? Will labour issues along my supply chain such as forced or child labour present reputational risks to my company?

How can I stay ahead of human rights litigation trends?

What opportunities could be unlocked by ESG issues or trends? How can I leverage on the growing market demand for low-carbon technology in my product development strategy?
What will be the financial impact of ESG risks and opportunities on my bottom line? How will increasing carbon prices affect the costs of energy or returns on investment within my portfolio?

What is the value of my company’s dependency on ecosystem services such as pollination?

What is the cost of non-compliance relating to ESG issues?

Impact Materiality

On the other hand, impact materiality focuses on a company’s impacts on environmental, social, and governance causes. It adopts an inherently inside-out perspective. Within this approach, companies would ask themselves:

Themes: Questions to ask:
What is the environmental impact of my business on the climate and natural environment? What is my company’s contribution to the global carbon budget?

What are the environmental impacts of my operation’s waste production?

How can my business practices protect or restore local ecosystems?

What is the social impact of my business on employees, workers along the supply chain, and communities where we operate? How can I create a working environment for my employees to thrive?

How can I ensure that employees and workers along the supply chain are paid a liveable wage?

What role can my company play in contributing to ethical and just societies? How will anti-competitive practices undermine the level playing field for participants within my industry?

How can I support and strengthen local institutions by enforcing anti-corruption and anti-bribery policies?

A double materiality approach unifies both financial and impact materiality, and asserts that companies should adopt both an outside-in and inside-out perspective.

Figure 3: Comparing financial and impact materiality

What position do the different reporting standards take?

Not everyone agrees that companies should consider both financial and impact materiality.

Some sustainability reporting standards place more emphasis on financial materiality, while others place more emphasis on impact materiality.

The Taskforce for Climate-related Financial Disclosures (TCFD) and the Sustainability Accounting Standards Board (SASB) are two standards that focus on financial materiality. Both standards guide companies towards providing comparable, consistent, and reliable sustainability data that meets investor needs[ii]. Both the TCFD and SASB have been designed to facilitate investment decisions and effective capital allocation.

Task Force Climate Related Financial Disclosures

The TCFD adopts an outside-in perspective, that seeks to identify, assess, and eventually evaluate the financial impacts of climate change on an organization[iii].

The SASB standards likewise seek to promote ESG disclosures that enable investors to assess how ESG issues translate into risks and opportunities for each business.

SASB standards focus on financial materiality

On the other hand, the GRI Universal Standards, and the EU’s Corporate Sustainability Reporting Directive (CSRD), emphasise the importance of impact materiality.

The GRI Standards place impact materiality at the centre of its definition of what an organisation should consider material, while acknowledging that understanding a company’s impacts could reveal what is financially material. The GRI  Standards are clear that impact materiality should take priority on the basis of public interest, and asserts that topics which are not financially material should still be included[iv].

GRI standards focus on ESG

The Corporate Sustainability Reporting Directive (CSRD) similarly emphasises impact materiality, but positions it on equal footing with financial materiality. It thus remains the only corporate reporting standard that explicitly incorporates double materiality into its reporting directive for companies. The intent of the CSRD is to make it possible for investors and the public to assess companies’ contribution to a sustainable and fair economic system[v].

EU EFRAG's definition of double materiality

The GRI and CSRD depart from the TCFD and SASB standards because they encourage companies to consider issues that may not necessarily have a financial impact.

What is at the heart of the debate?

Reporting standards & materiality

Impact and financial materiality both aim to define ESG issues that are significant to a company. However, both approaches have inherently different aims, and target audiences.

Financial materiality caters to investors and anyone who has a financial stake in the company’s performance. It thus seeks to assess the impact of an ESG issue on enterprise value.

Impact materiality caters for a broader group of stakeholders, including employees, civil society, local communities. In short, it recognises that businesses should create value for all its stakeholders, in recognition of planetary boundaries.

The fundamental question that confronts most businesses is whether they should be responsible for issues beyond those that have a clear or direct financial impact.

It can be hard to establish a direct relationship between human rights issues along the supply chain and enterprise value, but does that mean that respect for human rights is beyond the company’s responsibility to enforce? If we did not have carbon taxes or emissions trading systems, should companies still reduce their contribution to the global carbon budget? If companies do not have direct dependencies on ecosystem health, should they still ensure that their waste management practices do not cause pollution?

Should businesses be held accountable for issues outside of their direct influence and control?

What is the outlook for the reporting landscape?

A global common language for sustainability reporting is on the way. The International Sustainability Standards Board (ISSB), created by the IFRS Foundation, seeks to harmonise the fragmented reporting landscape and build an international baseline of sustainability disclosures. A unifying reporting standard will bring clarity to the market, and help companies, regulators, and investors to navigate sustainability reporting requirements.The IFRS Sustainability Disclosure Standards are expected to be adopted by many national regulators, including Singapore, Hong Kong, and Japan.

How such a global reporting standard defines materiality has naturally drawn intense interest from all stakeholders. The ISSB describes one of its objectives as “Develop standards for a global baseline of sustainability disclosures meeting information needs of global investors”, and defines information as material “if omitting, misstating or obscuring it could reasonably be expected to influence investor decisions.”[vi] Both of these statements imply a focus on financial materiality.

The ISSB does qualify that “A company’s ability to deliver financial value for investors is inextricably linked to stakeholders with whom it works and serves, societies in which it operates, and natural resources upon which it draws.” However, it has drawn criticism from stakeholders focused on impact materiality for its lack of attention to environmental and social impacts caused by the company.

ISSB and materiality

As a global standard-setter that could become the basis for regulators’ sustainability reporting requirements, the ISSB’s definition of materiality could have far-reaching implications.

The ISSB will tentatively be effective for reporting periods from 1 January 2024, and it is currently finalising its reporting requirements. As the reporting landscape continues to evolve and consolidate its requirements, the ramifications of the ISSB’s definition of materiality remains to be seen.




[i] A guide to materiality past, present, and future, FrameworkESG, October 2020

[ii] Why Companies Use SASB Standards, SASB Standards, August 2022

[iii] Position paper – Materiality and climate related financial disclosures, CDSB, 2018

[iv] GRI 1: Foundation 2021, The GRI 2021 Universal Standards

[v] Final Report – Proposals for a Relevant and Dynamic EU Sustainability Reporting Standard-Setting, European Financial Reporting Advisory Group, February 2021

[vi] An update from the International Sustainability Standards Board, IFRS Sustainability, February 2023















Blockchain For or Against ESG

Blockchain: For or Against ESG

The Blockchain Revolution[31] is here. Once regarded an enigma, blockchain has now flourished with the transformative potential to upend a wide range of industries. From smart contracts in real estate, to the recording of material in supply chains and transparent peer-to-peer transactions in finance, the possibilities it holds seem to be endless. Blockchain represents nothing less than the next wave of technological disruption and is enroute to permeating our lives. Could this new technology and its corresponding digital asset (“cryptocurrency”) be the future of everything?

With sustainability as the next frontier of business, the role of blockchain in sustainability is not to be dismissed. Blockchain could boost sustainability credentials, create opportunities in the energy market, reshape financial and legal systems, and expand business potential towards Environmental, Social and Governance goals. Despite its tantalising potential, the ripple that blockchain has left in the world of climate controversies is not to be forgotten. To the crypto-skeptic, blockchain’s massive carbon footprint remains an inherent climate catastrophe. Thus, it is imperative that companies wielding this powerful double-edged sword are able to weigh E, S and G implications as they look to reshape the dull 1.5°C outlook while mitigating long-term risks. This article weighs the pros and cons, exploring not just how blockchain may avoid a head-on collision-course with ESG, but whether it may be the key to unlocking ESG benefits.


What exactly is Blockchain?

Blockchain & Mining: An Environmental Catastrophe?

Or, Blockchain: the Key to Unlocking ESG Benefits?

Blockchain & The Environment: Friend or Foe?

Blockchain & Social Impact: Security or Volatility?

Blockchain & Governance: Navigating the choppy waters of Politics & Crime



What exactly is Blockchain?

Blockchain is an immutable system of recording information, a digitally distributed ledger of transactions duplicated across an entire network of computer systems. Every time a new transaction occurs, (i.e. new information is recorded), a block will be created and broadcast to all computers on the blockchain. Once this transaction is validated, the block will then be added to the chain. This process of validating transactions is known as blockchain mining. Data is stored in blocks, which are then chained together in chronological order, with each new block chained to the previous one. Notably, all sorts of information can be stored in blockchain – it is not limited to transactions.

Blockchain is marked by four inherent properties: accuracy, decentralisation, secure and private transactions, and transparency [14].

  • Accuracy: The blockchain network utilises thousands of individual computers in its verification process, reducing human error. In fact, any error can be easily detected as the error would only be on a single block. The other blocks will retain a copy of the correct information.
  • Decentralisation: Instead of having all information stored in one location, information is spread out across all computers participating in the blockchain network. This makes blockchain almost impossible to tamper with – in order to hack a chain, 51% of the blocks in the chain must obtain “consensus”, but such a large attack would undoubtedly be noticed.
  • Private and Secure Transactions: Blockchain networks are anonymous, and each transaction is recorded with a unique code rather than with identifying information. This way, we can be sure that the information recorded is secure and will not change.
  • Transparency: The chains are mainly open sourced and there is no single authority controlling the code. Anyone can view or participate in them.

Blockchain highlight: Blockchain Association Singapore

The Blockchain Association Singapore[5] (BAS) is a platform aimed at leveraging blockchain technology for business growth, as it recognises Singapore as a burgeoning hub for blockchain and blockchain’s tremendous potential value. Similar to the BMC, it promotes best practices and blockchain literacy, building a strong talent pipeline for the local digital economy. They host a variety of webinars and courses covering topics such as FinTech, enterprise blockchain and digital asset compliance, and are the organisers behind the annual Singapore Blockchain Week.

Blockchain & Mining: An Environmental Catastrophe?

Proof-of-Work mining, the most widely adopted validation mechanism used by both Bitcoin and Ethereum, is notoriously energy-hungry. Proof-of-Work mining requires miners across the globe to utilise highly energy intensive and specialised computers to generate as many hashes (strings of letters and numbers) as possible, at any given moment. Miners zealously race to solve arbitrary cryptographic problems, competing to create a hash that is identical to that of the new block. This is what ensures it absolutely secure and near impossible to tamper with[12].

Bitcoin, the world’s largest cryptocurrency, currently consumes around 150 TWh of electricity annually, surpassing that of the whole of Argentina with a population of 45 million[11]. An average Bitcoin transaction is estimated to consume roughly 1500 kWh of electricity, the same amount of power consumed by the average American household over 50 days[25]. It is no wonder Bitcoin mining has increasingly come under fire for its growing energy use. Even former bitcoin-enthusiast Elon Musk, an aggressive advocate for Bitcoin while the cryptocurrency’s price soared to delirious highs in early 2021, has now sold 75% of Tesla’s Bitcoin holdings. It was a hasty retreat, catalyzed by Musk’s announcement that Tesla would stop accepting Bitcoin payments due to environmental concerns in May of the same year[23].

Or, Blockchain: the Key to Unlocking ESG Benefits?

Blockchain technology itself, however, need not be diametrically opposed to ESG. It is no surprise that traditional Proof-of-Work mining consumes a great deal of energy, but as with any new innovative technology, could blockchain hold potential ESG value? The short answer is yes, and this claim will be critically examined below.

The potential ESG benefits of blockchain

Blockchain & The Environment: Friend or Foe?

As crypto miners have become increasingly environmentally conscious, the practice has begun to naturally gravitate towards cleaner and cheaper energy sources[22]. According to the Bitcoin Mining Council (BMC), the employment of sustainable energy in bitcoin mining is well underway. Founded in May 2021, the mandate of the BMC is to promote transparency, share best practices, and educate the public on the benefits of Bitcoin and Bitcoin mining. So far, the BMC’s research has continuously shown year on year improvements in Bitcoin’s green credentials, with the latest Bitcoin Mining Data review estimating that the global bitcoin mining industry’s sustainable electricity mix is now 59.5%, a 6% increase from Q2 2021 to Q2 2022[4].

According to the Bitcoin Clean Energy Initiative, Bitcoin could in fact encourage the use of renewable energy and accelerate the energy transition[3]. Bitcoin miners are unique energy buyers in two characteristic ways: Firstly, they are highly flexible, meaning they can mine anywhere as long as they are connected to the internet. Secondly, their load is easily interruptible, meaning their end use of electricity can be turned on or off at a moment’s notice. These combined qualities constitute an extraordinary asset for renewables and storage, as they directly address a key challenge of renewable energy deployment: intermittency (also known as the “duck curve”).  Solar and wind energy supply are either abundant or non-existent as the sun only shines during the day, and wind patterns vary, tending to blow more heavily at night. Thus, Bitcoin miners form ideal complements where they not only improve returns for solar and wind energy producers, but also allow for the construction of renewable energy projects before the completion of lengthy grid interconnection studies. They act as last resort buyers who can offtake energy until selling the grid becomes possible.

The notion that blockchain mining could act as a catalyst for the renewable energy transition is catching on globally. The Crypto Climate Accord comprising over 150 firms has been working to ensure a 100% use of renewables by 2030. Furthermore, Bitcoin mining and its future potential for energy efficiency was even highlighted at the COP 26 Climate Conference, serving testament to the emphasis placed on crypto sustainability and green solutions[9].

However, the offsets still come with big asterisks as pressing questions still need to be addressed: Will all miners transition to clean energy if it is based off self-initiative instead of regulation? If there is a scenario where there is more energy demand than what renewable sources can supply, where will these miners get their energy from? If more and more miners participate in this industry, wouldn’t that only increase the global energy demand making it harder for the global transition to clean energy?

Instead, Proof-of-Stake validation could present itself as the better call, an alternative validation mechanism that fundamentally does not require extra energy. It involves a network of validators “staking” their own cryptocurrency and locking their coins away to create a validator node, much like locking a deposit in a security bond[10]. Rather than having thousands of specialized computers chip away at arbitrary mathematical problems, the blockchain network simply algorithmically selects a winner to validate the block of transactions, an energy efficient alternative to competition-style Proof-of-Work mining. The algorithm allocates the rights to validation depending on percentage of cryptocurrency locked by each validator and how long their coins have been there. Where Proof-of-Work requires high-end graphics cards, Proof-of-Stake protocol could be run off the humble laptop[15].

Ethereum, another blockchain currency, has pre-eminently championed the move towards Proof-of-Stake. The Ethereum Foundation estimated that the transition, Ethereum 2.0 (Eth2) Beacon Chain, would plunge the energy usage of the platform by 99.95%[10]. Though this is great news for the green crypto enthusiast, the transition faces several technical challenges to be overcome. The Proof-of-Stake engine must be built and tested while having it run parallel to the existing Proof-of-Work system, and even after the engine is completely online it will have to run for some time while bugs are worked out. Time is also needed for the community to come  to a consensus and a time is set for the swap to happen. The official merge is estimated to go through by late 2022[7].

Blockchain & Social Impact: Security or Volatility?

Blockchain technology is also particularly relevant to emerging economies, where the use of blockchain could yield a host of social benefits[29]. In developing countries, blockchain represents an avenue for strengthened accountability, verifiable social impacts, and advancing financial inclusion.

Strengthening accountability to rural landowners: Reducing the prevalence of corruption: India’s shadow economy has been estimated to account for up to 50% of the country’s annual GDP, with the property sector emerging as the worst offender. It has been found that land transactions generate $20 billion to $40 billion of illegal money per year, equating to 1-2% of the GDP[27]. Thus, a consensus blockchain project had been pioneered in Chandigarh city, where blockchain is used to manage land ownership records[29]. As blockchain technology is secure and tamper-proof, it presents an unprecedented opportunity to prevent the changing of land records or ownership history via bribes. This could contribute to fairer compensation for rural landowners and increased visibility over whether informed consent has been attained.

Verifying positive social impact in supply chains: A report from the European Union Cybersecurity Agency precited a four-fold increase in supply chain attacks in the second half of 2021 alone. Private blockchain platforms present themselves as particularly apt supply chain management solutions as they provide traceability, transparency, real-time logistics tracking, and electronic fund or smart contract management[19]. Turning to procurement, blockchain could also enable both suppliers and customers to track the origins of products or materials they purchase. Applied to the food industry, blockchain allows anyone to verify the authenticity of product labels (i.e. organic, local, fair trade), ensuring that products bought have in fact contributed to positive social impacts. This is currently being rolled out by the IBM Food Trust[13].

Advancing financial inclusion in the developing world: Globally, 2.7 billion people have zero access to capital and most of them do not even own a bank account. Blockchain platforms such as BanQu or Humaniq provide the unbanked or under-banked, who may not have formal proof of identity, with accessible finance[28]. These platforms have leveraged blockchain technology using retina scans or selfies taken with mobile phones to create a unique hash of verifiable authenticity, like a social security number. Additionally, blockchain could make micro-finance loans more viable. Microfinance provides financial services to low-income groups that would not otherwise have access to finance. A key challenge in microfinancing is determining the creditworthiness of individuals who may not have any borrowing or financial records, as is often the case in rural areas. In Kenya, IBM partnered with Twiga Foods to provide a solution: a blockchain-enabled lending platform which utilises machine learning to ascertain credit worthiness before extending such loans to smaller food vendors[16]. These small businesses gained access to working capital through transparent fund transfers with lower risk of fraud. Smart contracts enabled by blockchain technology also drastically reduced the time taken to manually process and issue a loan.

While blockchain offers numerous possibilities and solutions within the microfinance industry, there are several gaps to be bridged before securing sustainable financial inclusion. The constant fluctuation and speculative nature of cryptocurrencies make them more of an asset, rather than cash. Relying on such a highly volatile asset always carries inherent risks. Low-income individuals or families would be especially vulnerable, should they have adopted the blockchain financing solution and their savings largely comprise of volatile cryptocurrencies.  Extreme fluctuations in cryptocurrency values clear precedents. In September 2021, China’s central bank banned all cryptocurrency transactions. This announcement immediately caused a crash in Bitcoin, with its price falling by more than US$2000[1]. Any unbanked and low-income individuals holding bitcoin would have immediately lost their savings.

Blockchain & Governance: Navigating the choppy waters of Politics & Crime

In September 2021, the president of El Salvador decided to adopt Bitcoin as legal tender[26], becoming the first sovereign government to do so. The government said that Bitcoin could save the country $400 million a year in transaction fees, though estimates from the 58 (utilising World Bank and government data) are closer to $170 million. While some might argue that $170 million is <1% of GDP, the real impact of this policy is in making transfers much more affordable for Salvadorans.

Many Salvadorans are faced with outrageously high remittance transfer fees. The global average cost of sending money is 6.5%, more than twice the Sustainable Development Goal target of 3% [30]. To residents of the low growth Central American nation and the large diaspora of Salvadorans in the United States, this is a substantial amount. Bitcoin thus offered a means to transfer value directly and globally without costly third-party intermediation. It is worth pointing out that following this legal tender, the Central African Republic (CAR) followed suit in April 2022, a visionary plan that the government argues would open economic opportunities and secure an independent financial future for the country[2].

However, El Salvador’s Bitcoin experiment seems to be struggling, as the government’s crypto offers have been cut in half, and the country faces more than $1 billion in debt in the next year following the fall in Bitcoin’s price of more than 70% from its November 2021 peak. Unsurprisingly, El Salvador’s credit scores have been knocked and negotiations with international lenders have been stalled for reasons such as skepticism towards cryptocurrency which is prone to extreme volatility. Recent data has shown that only 1.6% of remittances were sent via “Chivo Wallet”, a Salvadoran digital currency payment app trading in Bitcoin and dollars.

Still, Bitcoin enthusiasts continue to assert that the experiment has transformed El Salvador’s image to that of a technological trailblazer, and President Nayib Bukule himself has displayed unwavering enthusiasm for the cryptocurrency despite its price collapse[17], taking to twitter to boast about his Bitcoin purchases. Despite the blurry optics on the nation’s cryptocurrency future, perhaps increased consumer protectionism and legal certainty could revert it to the tool it was meant to be.

The European Parliament has also suggested that voting could be revolutionised by blockchain, citing that blockchain’s transparency and anonymity could potentially enable a fast and secure voting system[6]. This would simplify elections, make them cheaper, and lead to the development of stronger democracies by making voting more accessible. Fraud prevention could even be accommodated where voters are empowered to verify the voting records themselves.

Nevertheless, there have been several strong opponents to this, including Jeremy Epstein, the vice chairman of the Association for Computing Machinery’s U.S. Technology Policy Committee (ACM USTPC). He argues that blockchain’s security does not completely negate the risk of tampering. Firstly, there lies the possibility that the voter’s computer is hacked and contains malware before the voting even occurs. Additionally, there exists the risk of a large volume of information being hacked and everyone’s vote being leaked to the public. Even so, Epstein still agrees that there is still the potential that blockchain voting could work in the future if there were to be major technological breakthroughs, or fundamental alterations to the nature of the internet[20].

Given cryptocurrency’s libertarian ethos which touts anti-regulation and free-market ideals, it is unsurprising that this has inadvertently created headroom for a greater evil: Crypto-crime. For the crypto-criminal, blockchain network has manifested itself as rich lawless ground for anonymous data theft, ransomware attacks, fraud and illicit transactions. In particular, troubling trends have emerged over the past few years. Crypto-currency based crime doubled from 2020 to 2021[8], reaching a record high of $14 billion USD received by illicit addresses over the course of the year.

Non-Fungible Token (NFT) crimes have also increased exponentially. Financial losses from January to May 2022 were a whopping 667% higher than for all of 2021. The space saw twice as many hacks in 2022 than the whole of 2021[21], where cybercriminals are now regularly making off with millions in cryptocurrency. Rug pulls, a new lucrative scam type where fraudulent developers pump what appear to be legitimate cryptocurrency projects only to vanish soon after, has gained roaring traction due to its ease of execution[24]. Creating new tokens, having them listed on decentralized exchanges (DEX) within the decentralized finance (DeFi) ecosystem while skirting past code audits, and luring in unsuspecting investors  has become a relatively straightforward process. All that is left to do thereafter is siphon value away from funds, leaving investors with a worthless currency.

While the aforementioned figures are concerning, the numbers do not tell the full story. Total transaction volume across as cryptocurrencies grew 567% from 2020 to 2021. With blockchain’s widespread adoption, it is no wonder crypto-criminals have taken advantage of the DeFi boom. In fact, legitimate cryptocurrency usage has far outpaced that of illegitimate cryptocurrency usage as that saw only a 79% increase within the same timeframe, nearly a magnitude lower than overall transaction volume[8].

To further put crypto-skeptics at ease, regulation is visible on the horizon and mandatory measures to curb cryptocurrency crime at the exchange level seem to be high on the agenda. In Australia, cryptocurrency exchanges must be registered with AUSTRAC, in compliance with anti-money laundering and counter-terror financing obligations[18]. Another promising development is the growing ability of law enforcement to seize cryptocurrency from illicit transactions, such as IRS Criminal Investigations seizing more than $3.5 billion worth of cryptocurrency in 2021.


We are at a watershed moment in the age of digital transformation, and despite blockchain’s drawbacks, it is clear that it has already broken the shackles of mainstream business operation. Evidently, blockchain could have powerful ramifications on society if done right, realising its disruptive potential. No real business opportunity comes without risks, and the intersection between blockchain and ESG markets should be traversed with caution. Blockchain offers a means of supply chain resilience, improvements in product governance, and in operational and social efficiency that could not only reduce ESG risks, but also boost cost savings. Nevertheless, cryptocurrency remains the most common application of blockchain technology, and as a nascent asset it is still in the price discovery phase. Thus its price volatility must be accounted for in implementation, in order that stakeholders may be put at ease. While blockchain solutions will not be in everyone’s cards at this juncture, it is still imperative that businesses keep an eye on the technology, to stay competitive in the years ahead.


[1] BBC News. (2021, September 24). China declares all crypto-currency transactions illegal.
[2] BBC News. (2022, June 6). Why the Central African Republic adopted Bitcoin.
[3] Bitcoin is Key to an Abundant, Clean Energy Future. (2021, April). Bitcoin Clean Energy Initiative. Retrieved August 26, 2022, from
[4] Bitcoin mining electricity mix increased to 59.5% sustainable in Q2 2022. Bitcoin Mining Council. (2022, July 19). Retrieved August 26, 2022, from
[5] Blockchain Association Singapore. Retreived August 26, 2022, from
[6] Boucher, P., Nascimento, S., & Kritikos, M. (2017, February). How blockchain technology could change our lives (No. 978–92-846-0549–1). STOA – Science and Technology Options Assessment.
[7] Cawley, N. (2022, July 15). Ethereum 2.0: Switching to Proof-of-Stake (PoS). DailyFX.
[8] Chainalysis Team. (2022, January 6). Crypto Crime Trends for 2022: Illicit Transaction Activity Reaches All-Time High in Value, All-Time Low in Share of All Cryptocurrency Activity. Chainalysis.
[10] Frost, L. (2021, May 20). Ethereum Foundation: ETH 2.0 Will Use 99.95% Less Energy. Decrypt.
[11] Hertig, A. (2020, December 16). What Is Proof-of-Work?
[12] Hinsdale, J. (2022, July 28). Cryptocurrency’s Dirty Secret: Energy Consumption. State of the Planet.,of%20Argentina%2C%20population%2045%20million
[13] (n.d.). IBM Food Trust – Blockchain for the world’s food supply. United Kingdom | IBM. Retrieved August 26, 2022, from
[14] Iredale, G. (2022, August 15). History of Blockchain Technology: A Detailed Guide. 101 Blockchains.
[15] Kaplan, E. (2021, June 1). Cryptocurrency goes green: Could “proof of stake” offer a solution to energy concerns? NBC News.
[16] Kinai, A. (2019, July 19). IBM and Twiga Foods Introduce Blockchain-Based MicroFinancing for Food Kiosk Owners in Kenya. IBM Research Blog.
[17] Kurmanaev, A., & Avelar, B. (2022, July 5). El Salvador’s Bitcoin Bet Isn’t Paying Off. The New York Times.
[18] Lane, A. M. (2022, February 3). Crypto theft is on the rise. Here’s how the crimes are committed, and how you can protect yourself. The Conversation.
[19] Lundqvist, J. (2022, January 5). Fighting fraud in the supply chain with blockchain. Information Age.
[20] Mearian, L. (2019, August 12). Why blockchain-based voting could threaten democracy. Computerworld.
[21] Migliano, S. (2022, May 5). Cybercrime Statistics: Blockchain Crime and Malware Around The World. Top10VPN.
[22] Musharraf, M. (2020, October 1). Report: 76% crypto miners use renewables as part of their energy mix. Cointelegraph.
[23] Novet, J. (2022, July 20). Tesla has dumped 75% of its bitcoin holdings a year after touting “long-term potential.”
[24] Puggioni, V. (2022, February 6). Crypto rug pulls: What is a rug pull in crypto and 6 ways to spot it. Cointelegraph.
[25] Reiff, N. (2022, July 9). What’s the Environmental Impact of Cryptocurrency?
[26] Silver, B. K. (2021, September 8). Bitcoin crashes on first day as El Salvador’s legal tender. BBC News.
[27] Srinivas, B. A. (2012, December 10). India: Why land is at the centre of all scandals. BBC News.
[28] Staff, K. A. W. (2017, November 17). How Blockchain Technology Can Serve the Have-nots. Knowledge at Wharton.
[29] Staff, K. A. W. (2018, November 28). How the Blockchain Brings Social Benefits to Emerging Economies. Knowledge at Wharton.

[30] Subacchi, P. (2021, June 30). El Salvador’s adoption of bitcoin as legal tender is a wake-up call | Mint. Mint.

[31] Tapscott, D., & Tapscott, A. (2018, June 12). Blockchain Revolution: How the Technology Behind Bitcoin and Other Cryptocurrencies Is Changing the World: Tapscott, Don, Tapscott, Alex: 9781101980149: Books. Amazon. Retrieved August 26, 2022, from

Financing Biodiversity II: A biodiversity-informed framework to evaluate business risk & opportunity

This article is part of a series of thought leadership articles by the Paia team. Read Financing Biodiversity I to find out about the complexity of putting a dollar value on nature.

How should biodiversity and ecosystem services be integrated into the evaluation of business risk and opportunity? With rapidly depleting natural resources, and an increased focus on biodiversity preservation, businesses must pay attention to nature-related considerations.

After all, all economic activity is dependent on healthy ecosystems, directly or indirectly. Including the concept of natural capital in business risk assessments enables us to better capture the benefits of ecosystem services, such as water purification and pollination, in economic terms. Biodiversity refers to the variety of life at the genetic, species, and ecosystem level, and forms the living component of natural capital stocks. The interactions between biodiversity and non-living natural resources generate most of the flows, from the provision of essential resources to climate regulation, that benefit society[i].

Biodiversity is vital to the long-term success of many businesses. For example, in the pharmaceutical industry, biodiversity is critical to drug discovery, providing molecular diversity and medicinally important organisms[ii]. In the agriculture industry, plant and animal breeders take advantage of underlying genetic diversity to improve yield and quality, enhance pest resistance, and lengthen the growing season. Biodiversity can also underpin product innovation in these two critical industries by providing natural ingredients that provide flavour, aroma, nutrition, or medicinal attributes.

But businesses may not realise their dependence and impacts on biodiversity. With over 60% of natural capital impacts embedded in supply chains[iii], biodiversity restoration and protection are critical to safeguarding the sustainable procurement of raw materials. For example, fashion apparel brands like Kering source wool, cashmere, and cotton from farms and forests across the world. Kering’s in-house environmental profit-and-loss accounting tool (EP&L) converts its natural impacts into monetary terms. It has shown that Kering’s natural impacts are highest during raw material production, specifically around land-use and biodiversity.

Even businesses with no direct relationship to natural capital stocks must consider their biodiversity dependence and impacts along their value chain. For example, banks like ING have acknowledged their business’ impact on biodiversity, through their loans to companies[iv]. Their portfolio companies may be affected by biodiversity loss, which in turn exposes ING to biodiversity risks as a financier.

The global momentum for biodiversity protection is accelerating. Being nature-positive is becoming a key element of net zero emissions; governments and financial institutions around the world are connecting climate and nature. Recognition worldwide that nature loss poses financial, and even existential, risks to businesses is also growing. The Taskforce on Nature-related Financial Disclosures (TNFD) guidelines, complementary to the Taskforce on Climate-relate Financial Disclosures (TCFD) [v], is an upcoming framework that seeks to better understand the financial risks and opportunities posed by biodiversity on businesses. With TCFD becoming a regulatory response for governments around the world[vi], businesses can expect tightening biodiversity regulations if the TNFD follows the TCFD’s success. The Science Based Targets Network is also developing guidance for companies to set targets for nature, as another indicator of a global movement towards greater corporate responsibility for biodiversity.


Biodiversity - Informed Framework for Business Risk and Opportunity Infographic

In light of this global movement, the Paia team presents a biodiversity-informed framework for evaluating business risk and opportunity. The intention of the framework is not to provide answers, but to facilitate decision making and scaffold the evaluation of biodiversity-related opportunities and risks.

This framework positions biodiversity dependence at the centre of all risk and opportunity assessments, as all economic and business activity is rooted in biodiversity. Around biodiversity dependence revolve 4 interdependent pillars: Revenue, Cost, Compliance, and Capital.

There are tensions and trade-offs across each pillar. For example, revenue may be generated in the short-term through resource extraction. But unsustainable resource extraction is likely to generate higher costs in the long term, and additionally rule out opportunities for the development of new revenue streams synergised with nature.

As another example, growing recognition of our dependence on biodiversity and ecosystem services could also spur the scaling of biodiversity-related finance, lowering the cost of capital. With lower capital costs, biodiversity-related revenue opportunities could be more accessible. But access to capital is also accompanied by higher compliance requirements, which impose higher operational costs.

In this way, we can begin to imagine tensions and trade-offs across all 4 pillars. To facilitate deeper consideration, the rest of this article will expand upon the opportunities and risks of each pillar.



What new revenue streams might be unlocked from biodiversity restoration and protection?

Business action for biodiversity may lead to entirely new business models. By seeking to restore and protect biodiversity, businesses may generate new services and products. For example, Unilever has begun integrating biodiversity into its supply chain management, resulting in products sourced from regenerative framing practices.

Entirely new businesses may also be created in ecosystem restoration, as these 5 startups have realised. New markets may develop or existing markets may expand – the ecotourism sector has been forecasted to grow by 10-30%, and the organic food and beverage sector by around 16%[vii]. New revenue streams may also be unlocked, in the form of payments for ecosystem services in wetlands and forests, or if novel scientific discoveries generate licensable patents in future.


Will biodiversity legislation impact revenue generation?

Companies will have to examine their revenue generation sources and predict the trends of biodiversity legislation in their target markets. For instance, a land reclamation company must be aware of the potential protections that may be legislated for coastal ecosystems, which may halt projects in those waters.

What is the impact of declining ecosystem services on the revenue stream?

Many revenue streams are directly or indirectly dependent on ecosystem services. For example, the $7 billion almond industry in California depends on US bee colonies for pollination[viii]. But honeybee populations have been rapidly declining, due to industrial agricultural methods that put biodiversity last and monoculture first[ix].



How can biodiversity protection reduce recurring costs?

Recurring operational costs may also be reduced by investing in measures or technology that protect ecosystems. For example, by investing in higher security for fish farms to prevent escape, companies can reduce costs incurred to replace the fish as well as prevent genetic contamination with wild stocks.


What are the potential business costs of degrading natural capital?

The continued degradation of natural capital stocks and biodiversity often results in tangible and intangible costs. These costs might include potential legal liabilities and pollution clean-up, the loss of ‘social license’ or reputation, and the costs incurred from supply chain disruptions due to emerging infectious diseases (e.g. Covid-19).

What are the potential costs of altering natural features?

The removal of certain parts of the natural environment could lead to cascading costs. For example, the Catskills watersheds in New York[x] provide a natural way to filter contaminants from water. Man-made changes to the watersheds such as road construction could reduce the water quality available to businesses and individuals, leading to an increase in costs for energy and resources needed to artificially clean the water.



What opportunities could accompany compliance requirements?

Compliance requirements can facilitate the discovery of business opportunities. Mandatory climate reporting requirements have encouraged companies to undertake deeper reflection into how climate positive policies could benefit them. For example, tax benefits and subsidies could enable them to develop cleaner technologies that are more competitive in a greener market. Nature-related or biodiversity reporting could similarly translate into business opportunities.

Could compliance build internal capacity for biodiversity-related assessments?

Biodiversity risks, like climate risks, must eventually be integrated into strategic business planning. Additional compliance requirements may present an opportunity for businesses to adapt early by building up internal knowledge and familiarity with biodiversity-informed cost and benefit analyses.


What will be the operational resources committed to compliance?

Complying with the requirements of green financing is likely to necessitate certain steps by the business operation to minimise or even preserve or restore biodiversity. Such compliance would include resources needed to measure, report and verify impacts to biodiversity, and expertise needed to conduct studies to establish biodiversity baselines either revolving around the direct operations of a business, or along supply chains. Companies must question if they have the requisite expertise or whether they can outsource these changes to a third-party.

What are the financial costs of the baseline level of compliance?

The operational resources detailed above will come with a financial cost. Companies need to establish a basic understanding of how much additional costs would be added to the project’s income statement.



What are the current and potential opportunities for access to financial capital?

With growing investor motivation, more funds with biodiversity related objectives will be launched. Just as how investors have recognised that climate impacts present “unhedgeable risk”[xi] to investment portfolios, investors are now realising that long-term value creation is dependent on biodiversity protection and restoration. The Finance for Biodiversity Pledge, a coalition of 26 asset managers, insurers and banks formed in 2020, is a strong indication of investors’ shifting perception towards the importance of being nature-positive[xii]. As another harbinger of funding opportunities to come, AXA launched a climate & biodiversity fund in 2019[xiii].

As momentum for biodiversity-related financing builds, companies could also consider engaging with a wider set of financiers. With more private sector financing options, there may be more opportunities for public funds to cushion biodiversity financing through blended financing.


What is the future cost of capital?

Cost of capital could increase if funds begin to divest from assets that do not take care of biodiversity, similarly to how the availability of capital for fossil-fuel related stocks is shrinking. Just as for any other investment, companies can consider the extent of capital increments depending on whether the capital was obtained from debt investors or equity investors, both of which have different risk and return expectations. Current access to capital may also be at risk of being withdrawn. Although legislation may not mandate certain actions, institutional investors and banks tend to be quick to respond to the demands of the collective pool of investors that finance them. These financial institutions may hence shed investments in companies deemed to be laggards in biodiversity protection, raising the cost of capital for companies.

What would be the impact of violating sustainable finance requirements?

Access to financial capital for biodiversity-related projects can come with onerous requirements. Businesses must consider carefully if they can keep up with the requirements throughout the lifespan of the project, and the consequences of being unable to comply.


The concept of natural capital allows us to frame our dependence and impact on nature in economic terms – and the connection between biodiversity and financial flows has never been more salient. Economic development can no longer be segregated from ecosystem services, and growing recognition will spur legislative and capital shifts. As your business learns to navigate the integration of biodiversity considerations into their evaluation of business risks and opportunities, the Paia team hopes this framework constructively facilitates your reflection.

Stay tuned for Financing Biodiversity IIII, our final article in this series, where we will reflect more deeply on biodiversity as an asset.

If you are ready to embark on your nature-positive journey, contact us today.


[i] Biodiversity and natural capital, Cambridge Conservation Initiative:

[ii] Biodiversity, drug discovery, and the future of global health: Introducing the biodiversity to biomedicine consortium, a call to action, Journal of Global Health:

[iii] Biodiversity, and a Conservation Hierarchy for Kering S.A,  Bull, J, P. Addison, M. Burgass & S. Sinclair.

[iv] Biodiversity, ING:


[vi] Companies, investors face new pressure from compulsory disclosure of climate risk, S&P Global:

[vii] Biodiversity: Finance and the Economic and Business Case for Action. OECD:

[viii] Business benefits of biodiversity in agriculture, BCG:

[ix] California’s almond trade is exploiting one of nature’s most essential workers, IFIS:

[x] A billion Dollar Investment in New York’s Water, New York Times:

[xi] The Business Case, Climate Action 100+:

[xii] Finance for Biodiversity Pledge:

[xiii] AXA & Biodiversity, AXA:

Accelerating action for biodiversity: what the built environment sector needs to do

The built environment sector needs to protect biodiversity. Why? Because the sector not only depends on the raw materials provided by the natural environment, but it indirectly depends on the regulation of ecosystems, and the health and aesthetical benefits of the natural environment.

If you can protect biodiversity, you can attract buyers and tenants. You will have seen that advertisements for residential properties in particular commonly feature green spaces and nature areas as an attraction point or an amenity (think “surrounded by lush greenery” or “just a few minutes away from the sea”).

However, despite depending so heavily on nature, the sector is one of the top-three sectors threatening global biodiversity, according to the World Economic Forum (WEF). As one of the top three sectors, the built environment contributes significantly to depleted food and raw material supplies, incidences of extreme weather events and the collapse of ecosystems.

WEF’s The Future of Nature and Business report provides 5 key reminders on what we, the built environment sector, need to do to protect biodiversity.


What do we need to do to protect biodiversity, and why?

1. By compacting, not sprawling

We need to make cities and developments compact so that we avoid encroaching on natural areas at all. The rapid expansion of cities and urban areas, made worse by poor land planning and lack of biodiversity/environmental impact assessments, often leads to the loss of biodiverse natural areas and in extreme cases, the extinction of species and collapse of an ecosystem. As a result, the built environment sector is responsible for nearly 30% of biodiversity loss globally (World Economic Forum, 2020).

Compacting our cities and developments helps to make space for biodiverse natural areas that would otherwise have to be converted into other land use types. Globally, 60% of all urban space is sparsely populated (World Economic Forum, 2020). We can obtain inspiration from cities like Hong Kong and Singapore which have efficient planning of dense urban areas and allocated spaces for nature areas despite limited land areas. Denser areas can bring workplaces and services closer to homes which in turn reduce the cost, time and pollution associated with transportation.

2. By considering impacts to biodiversity before development

Before locating an infrastructure or building, we should consider our impact on surrounding biodiversity from the construction to management stage. Developers can include biodiversity considerations in impact assessments to find out whether a site provides habitats for important or threatened species. This helps to facilitate the process of sustainable site selection and the evaluation of alternative options (such as brownfield sites). A biodiversity or ecosystem impact assessment should be a standard procedure for developers to establish a baseline to identify the extent of impact and avoid and mitigate damage to areas with high biodiversity value.

We can also be more innovative in leveraging nature in our planning, design and retrofitting of buildings and infrastructure. These includes designing spaces that benefit both humans and biodiversity – for example, setting aside green spaces that provide restorative benefits to people but are also habitats for vulnerable species of animals. City Development Limited’s The Rainforest in Singapore was conceptualised as a “nature reserve” for threatened plant species, with nearly 50 native species of trees, palms, shrubs and groundcover (Lim, 2017). This particular example also reminds us to use native species and to consider the “diversity” in “biodiversity” – using native instead of exotic species and having a variety of species are key to recreating or restoring a healthy local ecosystem     .

3. By preventing pollution and providing clean energy alternatives

We should not forget that preventing pollution and providing clean energy is just as important for biodiversity protection. As urban areas expand, utilities will also need to keep up. Sanitation, waste disposal and clean energy are essential services that need to be scaled up in many parts of the world to meet growing demands. Over 80% of global wastewater is discharged into biodiversity-rich freshwater and coastal ecosystems without proper treatment (World Economic Forum, 2020). The built environment sector can help to prevent these by setting up effective management systems for solid waste and wastewater. For example, we can reuse wastewater onsite, such as graywater and condensate water, with existing water treatment solutions. We can also provide clean energy solutions such as solar lamps to replace kerosene, candles and firewood to reduce carbon emissions and deforestation. This not only protects biodiversity but also improves the standard of living of the community.

4. By harnessing natural ecosystems as infrastructure

We can harness nature’s benefits by incorporating naturally functioning ecosystems into the planning and design of the built environment. This is increasingly important for climate change and disaster adaptation. A commonly used example is mangrove forests. Mangroves are important and diverse ecosystems that effectively sequester carbon and protect coastal areas from storms. They also support livelihoods for coastal communities and framing natural ecosystems such as mangroves as assets, incentivises broader interest in protecting and cultivating them. There is growing consensus that incorporating natural ecosystems can be cost-effective in the long run, especially when combined with human-engineered solutions (Seddon, 2000). Furthermore, the natural ecosystem’s ability to regenerate means      lower maintenance costs compared to man-made structures. Another example is to maintain or restore healthy vegetation to prevent land erosion and/or improve water drainage. With climate change, these ecosystem services are becoming more important, especially when more intense storms due to climate change increases the risks of landslides and flash floods inland.

5. By planning infrastructure networks with biodiversity in mind

We should also plan for the wider infrastructure network, such as roads, railroads and pipelines, with biodiversity in mind. Such infrastructure can have as much, or even bigger, impact on biodiversity as the main infrastructure. Time and distance may be compromised, but it could be crucial in preventing habitat fragmentation and protecting vulnerable species which has more dire consequences.


Why haven’t we been doing enough for biodiversity?

We haven’t been doing enough for biodiversity, because the indirect benefits of biodiversity are often not captured by the sector’s financial accounting in a way which influences management decisions. The complexity of quantifying the risks and opportunities of biodiversity impacts means that financing projects with the aim of protecting biodiversity is currently not mainstream. As a result, we are currently not doing enough for biodiversity. However, this is about to change, with increasing expectations by investors and regulators on nature-related financial disclosures and action.

We should not wait to comply with regulations. Being responsible for nearly 30% of biodiversity loss globally, the built environment sector needs to urgently become more biodiversity-conscious in the way we develop, construct and operate. We need to prevent the catastrophic impact of ecosystem collapse – before it is too late.



Lim, Y. (2017, May 14). Property: Natural landscaping an important aspect for new condo buyers. Retrieved from News:

Seddon, N. C. (2000). Understanding the value and limits of nature-based solutions to climate change and other global challenges. Philosophical Transactions of The Royal Society B Biological Sciences.

World Economic Forum, A. (2020). New Nature Economy Report II The Future Of Nature and Business. Geneva: World Economic Forum.

Financing Biodiversity

Financing Biodiversity

Biodiversity, which refers to the variety of life within an ecosystem, is crucial for the flourishing of all life on earth. We frequently draw upon nature for inspiration or new substances based on the characteristics of plants and animals. Diversity in genetic material also strengthens the resilience of the population against emerging threats of disease or climate change. The removal of certain organisms could have an unintended effect on the populations of other species that people depend on.

However, biodiversity is in danger of being neglected while climate change receives more attention. For instance, carbon offset programmes to mitigate climate change often involves the reforestation of a single species of trees[i], which is unable to provide the ecological functions of a forest ecosystem with many different species of trees. Human activities, such as the expanding demand for agricultural land, also continue to threaten natural habitats.

The need to balance climate change mitigation, human activity and biodiversity preservation is known as the triple challenge[ii]. Improvements or deteriorations to any of these three aspects can reverberate across to the others. It is therefore necessary to pay attention to the issues plaguing each of the three aspects.

In a series of articles, the Paia team will discuss the implications of biodiversity protection and loss for the private sector. This article will present an overview of biodiversity financing, while the second will lay out a potential framework with which the value of biodiversity can be better accounted for. The third article will cover means in which biodiversity can be viewed as an asset to promote conservation. Together, our articles will demonstrate why businesses today must consider the value of biodiversity alongside other ESG concerns.


The complexity of putting a dollar value on nature

Markets for climate financing have developed rapidly over the past few decades. While there is still a long road to go, there are liquid markets in many regions for the trading of carbon credits. The global Carbon Trade Exchange, the Shanghai Environment & Energy Exchange in China and Singapore’s upcoming Climate Impact X exchange are but some examples. The same cannot be said for markets in biodiversity, where financing solutions that seek to mitigate the impact of human development are scant. However, to ensure that efforts to improve biodiversity are self-sustaining and not dependent on continuous activism, such solutions are vital.

In this article, we will lay out:

1) Why biodiversity financing is more complex than carbon financing

2) Current solutions in biodiversity financing

3) Potential pitfalls in designing these financial instruments


Why is biodiversity financing more complex than climate financing?

Although the issues of climate change and biodiversity are very much intertwined, the complexity of linking financial instruments to biodiversity benchmarks is greater than for its climate change counterparts.

Firstly, the impact on biodiversity from human activities is often non-linear and unpredictable. Unlike climate change which can be modelled based on the level of carbon emissions, the interconnectedness of ecosystems often leads to cascading effects when their equilibriums are disturbed. The loss of certain species can lead to unpredictable, yet devastating consequences. Financing structures often need a quantified metric with which they can base the expected rate of return upon. It is hence also difficult to price in the negative externalities generated by firms. An inability to set the value of biodiversity in quantified terms hence hinders the development of financing solutions.

Secondly, biodiversity impact is more difficult to trade from one area to another, and similar offset programmes cannot be applied to seek out arbitrage across large distances. As the removal of organisms from one ecosystem will have implications on other species that depend on them, damage is highly localized and cannot be compensated for by interventions in another area.  Thus, unlike carbon emissions, biodiversity impact cannot be as easily mitigated through the application of the Coase Theorem[iii]. The Coase Theorem refers to the concept that efficient outcomes can be achieved through bargaining to reflect the true value of property rights. Carbon permits find a pareto efficient outcome through the trade of allowances to emit, made possible since the generation of 1kg of CO2 in, for example, the United Kingdom can be offset by the removal of 1kg of CO2 in, for example, China. This brings down the overall opportunity cost of reducing emissions. The highly localized nature of biodiversity impact does not allow for a similar system.


Current Solutions

Efforts to protect biodiversity in a self-sustaining way have sprung up. These complement regulatory action that require constant enforcement, such as poaching and logging bans.

Some areas of conservation apply the Coase Theorem to mitigate the impact of human activity on conservation. For example, farmers can be compensated for livestock loss from wild predators, preventing the farmers from retaliating. Compensation can be drawn from the tourism revenue generated by these predators, forming a self-sustaining loop. However, such schemes are often supplanted by assistance from the government or NGOs, indicating that the value of tourism is insufficient to support the costs of conservation.

In another example, the preservation of fisheries is now often facilitated by Individual Transfer Quotas (ITQs)[iv], which cap the number of fish that can be captured and allow fishermen to trade these ITQs. Hunting permits work in the same way, auctioning off the right to hunt a limited number of animals.

Other solutions combine carbon and biodiversity. Also, Australia’s Carbon + Biodiversity Pilot[v] rewards farmers who improve both climate and biodiversity performance. Under the pilot programme, farmers who plant native trees will receive payments for biodiversity outcomes, which adds on to payments from carbon abatement projects


Potential Pitfalls

While commendable for slowing the decline in biodiversity, these measures are often reliant on enforcement against illicit behaviour.

The solution involves the design of financial instruments that reframe biodiversity as an asset to the owners of the land, instead of a nice-to-have. An asset is a financial instrument that is expected to bring economic benefit. To place a value on biodiversity and pave the way for quantified incentives in its conservation, methods to determine the present value of the cash flows from biodiversity have to be constructed. This metaphor can be extended to the way in which assets are depreciated through use over time as well as impaired from improper use; the benefits brought about by biodiversity declines as resources are extracted and careless treatment leads to an unnecessary decline in value.

The Dasgupta Review[vi], a report commissioned by the UK government on the economics of biodiversity, suggests that nature be regarded as a portfolio of assets that has thus far been “mismanaged”. He advocates that the full impact of human activity should be demonstrated by the agglomeration of not only human and produced capital, but also natural capital Dasgupta also cautions against solely using a pricing strategy to resolve the tragedy of the commons issue, since the difficulty in determining nature’s value creates barriers against developing an optimal price. The tendency to underestimate the value of nature could hence give rise to overconsumption deemed efficient. In addition, having a price tag attached to the exploitation of nature could then remove the psychological barriers of people to do so, much in the same way that parents tend to be later in picking up their kids if a small fine is imposed[vii]. Finally, a system that seeks to allocate resources requires a robust system of property rights which may deprive indigenous communities of resouces they have traditionally relied on. The initial allocation of property rights may also strike some as being unfair, especially to those who believe that nature is a part of the commons and unowned by humanity. Yet, property rights are necessary for such a system because only property owners have an incentive to defend against exploitation, negating the Tragedy of the Commons.

Nonetheless, while it is important to realise that any pricing strategy would potentially undervalue the true contribution of nature to humanity, it is vital to start somewhere. These schemes can be tweaked and improved incrementally so that they tend towards a reflection of the true value of nature.

Biodiversity financing is complex, and current solutions have their pitfalls – but it has never been more essential for businesses to keep in view. In the next article, we will cover how businesses can consider the impact of such schemes and the conservation of biodiversity in general on their operations.



[i] Is planting trees as good for the Earth as everyone says? –
[ii] The Triple Challenge – WWF –
[iii] George Stigler, the First Apostle of the “Coase Theorem”-
[iv] Ensuring individual transferable quotas benefit fisheries and the environment –
[v] Carbon + Biodiversity Pilot –
[vi] Final Report – The Economics of Biodiversity: The Dasgupta Review –
[vii] A Fine Is A Price –

Photo by Mark Stoop on Unsplash

Carbon Offsets and Credits Explained

Carbon Offsets and Credits, Explained

The Carbon Credits Ecosystem infographic

Figure 1: The Carbon Credit Ecosystem, by the Paia Team

The urgency of our planet’s rising temperatures cannot be understated, and more and more companies and governments have announced net-zero goals.

But as companies and governments conceptualise their net-zero roadmaps, they will unavoidably continue to generate emissions in the short-term. To offset these emissions, companies have turned their attention to the promise of carbon offsets and carbon credits, weaving them into their wider decarbonisation strategies.

So what are carbon offsets? What are carbon credits? And how do they work?

This article is part of a new explanatory series by the Paia team, where we will break down everything you need to know about the most current topics. Stay tuned for more.


What are carbon offsets?

Every carbon offset represents 1 tonne of reduced CO2 or its greenhouse gas (GHG) equivalent, that compensates for emissions made elsewhere.

By purchasing carbon offsets, anyone can finance a certified climate action project, and bring about a real reduction in emissions elsewhere in the world. After all, GHGs are released into the global atmosphere, so no matter where the reduction happens, the same positive benefit is achieved.

Carbon offsets are an exciting way to channel capital to much-needed causes, while we look for the solutions and technology we need for hard-to-reduce emissions.


“Imagine how expensive it is for an already state-of-the-art factory to reduce its emissions by 30% versus a dirty coal plant in the Ukraine to reduce a similar amount of emissions by installing upgraded, new equipment. Carbon offsets enable capital to reduce emissions in the most efficient manner possible. Carbon offsets support technology transfer, international development, jobs and exports for developed countries and so forth.” From[i]


Are carbon credits and carbon offsets the same thing?

Yes, and no. Every carbon credit, like every carbon offset, also represents one tonne of emissions reduction, so both terms tend to be used interchangeably. Think of it this way – carbon credits are verified certificates for a unit of emissions reduction or carbon removal, enabling carbon offsets to be bought and sold in a carbon marketplace[ii].

Carbon credits are referred to as tradeable instruments, and are certified by independent certification bodies. Every carbon credit is traceable and finite; once used to offset any organisation’s emissions, they are retired forever, and cannot be sold again.


What types of carbon offsets are there?

There are generally two types of carbon offsets – those that reduce emissions from existing or future operations (carbon avoidance), and those that remove existing carbon in the atmosphere (carbon removal).

Carbon avoidance projects commonly include renewable energy projects that enable the replacement of carbon-intensive fuel burning processes, such as wind farms, biomass energy, hydro electric dams, or biogas digesters.


Sichuan Rural Poor-Household Biogas Development Programme

In the province of Sichuan, coal and firewood burners in low-income households are being replaced with biogas digesters that recover methane from animal manure, as well as smoke-free cookstoves. By avoiding both the methane released by livestock, and carbon emissions from burning coal and firewood, this programme has the potential to save up to half of Switzerland’s annual emissions within its 28-year lifetime[iii].

Sichuan rural poor household biogas development programme

Carbon removal projects include both nature-based solutions such as mangrove restoration, where new trees planted sequester carbon from the surrounding air, and technological solutions such as enhanced mineralisation and direct air capture.


How are carbon offsets and credits audited?

Carbon offset programs issue, transfer, and retire carbon credits, so they act as standard setters for carbon credit quality[iv]. On platforms such as Verra, Gold Standard, and the Clean Development Mechanism (CDM), project developers must undergo a strict registration process, involving rigorous auditing processes.

To verify that offsets projects indeed result in real emissions reduction, these offsets programs require the help of independent auditors. These auditors rely on science-based calculations to estimate carbon stocks and flows.

Before registration, project developers must engage auditors to validate their project methodology. Once the project has begun operating, auditors must be engaged to routinely monitor, report, and verify (MRF) the emissions reductions once again.


What makes a reliable carbon offset and credit?

What should you consider before you buy a carbon offset, or finance an offsets project?


Additionality simply means that the emissions reduction or removal must be additional to, or on top of, what would have happened without the carbon offset project. If the reductions would have happened anyway, the offset cannot be considered additional.

But this is quite hard to determine in practice. For a forest conservation project to be considered additional, project developers must show that the forest would have been otherwise harvested and cut down. For a renewable energy project involving the installation of a windfarm, the project developer must show that the farm would not have been built anyway because of existing government incentives.

Therefore, it is better to ask, “How likely is the project to be additional?”


It may sometimes be difficult to guarantee that carbon captured will be kept out of the atmosphere forever. For example, a bushfire may consume trees planted in a reforestration project, suddenly releasing the carbon stored back into the air. More permanent carbon capture technologies are still undergoing research and development.


Offsets projects should not accidentally encourage the “leakage” of emissions elsewhere. For example, protecting one area of the forest may lead to deforestation in unprotected areas, if this risk is not accounted for in project design. Such an outcome would negate any benefits from the offsets project.

Leakage also extends beyond emissions – causing social harm would also take away from any successfully reduced emissions. Offsets projects should ideally bring about co-benefits, such as improving the livelihoods of local communities through providing new jobs. They should not inadvertently cause damage, such as violating the indigenous rights of people living around the project area.


Where can you buy and sell carbon credits?

Financial transactions for carbon credits, once issued, are handled on carbon exchanges, or through brokers and retailers. Through these third parties, project developers may sell issued credits to interested buyers such as companies looking to offset their unavoidable emissions.

Credit buyers may choose to engage directly with project developers, at any point from methodology development, to after credits have been issued. Getting involved at earlier project stages enables credit buyers to understand the offsets project more deeply, and skipping third parties such as brokers or retailers also gives buyers access to lower prices.

For buyers interested in a range of readily available offsets, and saving time on engaging directly with project developers, third parties may be more suitable. Carbon exchanges – such as Climate Impact X (CIX), a global carbon exchange headquartered in Singapore – allow for quick transactions and large volumes of carbon credits. Brokers offer similar benefits, while helping buyers access more project information, though at higher costs. Retailers suit buyers looking to buy credits at smaller volumes[v].


How should carbon offsets fit into your decarbonisation strategy?

Companies should reduce the emissions wherever possible, and only offset unavoidable emissions.

Carbon offsets hold exciting potential to accelerate decarbonisation globally, by channelling funds to vital projects that reduce carbon and bring about co-benefits that may otherwise have lacked the resources to operate. Carbon offsets provide economic incentives to NGOs, governments, and communities to lower their GHG emissions, that may not otherwise have been present.

But carbon offsets have not always lived up to their credibility, resulting in accusations of greenwashing by buyers, and slowing progress on climate action.

So carbon offsets must be used responsibly. Companies should first have strong reduction plans, undertaking a comprehensive review of their emissions both internally and beyond their value chain. Carbon offsets should only be reserved for emissions that have high barriers to reduction, or where technology is currently lacking, and should be factored only into a company’s short-term strategy. In the long-term, a robust decarbonisation strategy should eventually result in negligible emissions, through measures such as flying less or investing in energy-efficient technology and processes.



[i] Is There a Difference Between Carbon Offsets and Carbon Credits?, –

[ii] What is a Carbon Offset?, Carbon Offset Guide –

[iii] Sichuan Rural Poor-Household Biogas PoA, Gold Standard –

[iv] Carbon Offset Programs, Carbon Offset Guide –

[v] How to Acquire Carbon Credits, Carbon Offset Guide –

Carbon markets and climate policy - Opportunity in a decarbonising world

Carbon markets and climate policy – Turning Risk into opportunity in a decarbonising world

By Valerie Phua

At the 8th Singapore Dialogue on Sustainable World Resources, a range of perspectives across the public, private, and academic sectors converged into a key message: agribusiness and forestry must pivot towards sustainability to turn current risks into future opportunities.

In this article, Paia breaks down our key insights from the panel discussion.


Carbon credits will unlock decarbonisation opportunities in Southeast Asia

The tidal shift to a low carbon world has been palpable. With major corporations pledging their commitment to net-zero targets, carbon credits are gaining attention from investors and businesses alike.


What are carbon credits?

Carbon credits are verifiable and measurable emissions reductions from certified climate action projects. These projects reduce, remove or avoid greenhouse gas (GHG) emissions, in addition to multiple other benefits, eg. community empowerment, ecosystem protection, forest restoration, and reduced reliance on fossil fuels.

Carbon credits can be bought by companies, and provide a viable way for companies to offset unavoidable emissions in their net-zero transition. However, Paia recommends that carbon offsetting should always be employed in tandem with a range of other emissions reduction strategies.


The growing interest in carbon credits holds great opportunity for Southeast Asia. Being a global hotspot for blue carbon opportunities, but also a hotspot for deforestation risk, Southeast Asia’s carbon stores may offer the highest rate of return globally[i]. And the opportunity is perhaps greatest in Indonesia.

With one-fifth of the world’s mangroves and the third-largest area of peatlands globally[ii], Indonesia’s mangroves hold 3.14 million tonnes of carbon dioxide, and its peatlands store approximately 57 billion tonnes[iii].


What is blue carbon?

Blue carbon refers to carbon stored in marine and coastal ecosystems over decades, and deforestation not only releases these substantial carbon stocks, but also reduces the amount of carbon dioxide that these ecosystems could have removed.


With such huge carbon stores, the Indonesian government recognises the potential risk of losing these precious carbon sinks, and other vital accompanying benefits – mangroves protect coastlines from erosion and storm damage, sustain livelihoods of local communities, and are rich with biodiversity.

In 2021, Indonesia extended its ambitious campaign to restore 600,000 hectares of mangrove forest up to 2024[iv]. And efforts have admirably considered not only environmental factors, but the social realities of impacted communities. During the panel, Dr Ayu Dew Utari, Secretary of the Peat and Mangrove Restoration Agency (BRGM) in Indonesia, shared that the local government has embraced the inclusion of local communities in restoration projects. Dr Ayu emphasised that all initiatives should eventually be permanent and self-reliant, and strong community partnership involves villagers seeing the benefit of mangrove restoration to their quality of life as well.

With restoration projects well underway, Indonesia will be an attractive hotspot for carbon offset initiatives. Carbon credits will offer a way for local governments and communities to finance their climate action efforts, providing an economic incentive beyond environmental and social imperatives.


Carbon marketplaces will connect nature-based solutions with vital funds

Only last month, Climate Impact X (CIX), a new global carbon exchange and marketplace headquartered in Singapore, was launched. CIX is a joint venture by Singapore Exchange (SGX), DBS Bank, Standard Chartered, and Temasek, aiming to provide organisations with “high-quality carbon credits to address hard-to-abate emissions”[v].

With recent research showing that natural climate solutions could deliver up to one-third of the emissions reduction required to reach a 1.5 degree Celsius pathway by 2030[vi], there is a crucial need to connect these projects to the financing they will need.


What are nature-based solutions (NBS)?

An NBS uses tools already provided by nature to address issues resulting from poor land or resource use, climate change, or societal challenges. Solutions often enhance existing natural or man-made infrastructure, to spur long-term economic, social, and environmental benefits[vii]. Mangrove restoration is one such example of NBS.


However, as Mikkel Larson, Chief Sustainability Officer of DBS Bank, explained in the panel, inconsistent carbon credit quality and the lack of transparency in carbon pricing has limited market growth[viii]. The CIX aims to instil integrity in carbon markets through mapping carbon credit benefits in dollar terms, and introducing measures that prevent companies from avoiding the hard decarbonisation issues in their industry.

As the current risks associated with carbon credits are too high at present profit margins, Mr Larsen also explained that the CIX aims to facilitate investments in the lower denominations, thus improving access to the carbon marketplace for smaller corporations or investors.

With a more robust, trusted, and accessible marketplace, emissions reduction projects will see vital funds being channelled towards their scaling.

This will be especially true for nature-based solutions (NBS). As Professor Koh Lian Pin, Director of Centre for Nature-Based Climate Solutions at NUS, explained in the panel, NBS are presently the only commercially viable and scalable carbon capture solutions available.

But the research is still evolving, as estimates of carbon stocks and flows in natural ecosystems continue to be improved, Prof Koh emphasised. Another area of research would be the mapping of the co-benefits of NBS at the regional level, which an NUS project is currently working on. Prof Koh’s work will be essential to the verifiability and pricing of carbon credits, once again facilitating the success and expansion of voluntary carbon markets.

As corporate commitments to net-zero accelerate by the day, greater carbon market integrity and transparency can only be a promising development for the scaling of nature-based solutions.


Carbon regulations will shift business risks and opportunities

As climate policymakers ramp up their efforts to motivate the reduction of carbon footprints, carbon taxes may increasingly become a reality for agribusinesses to face.

One such policy that will have rippling effects across international trade is the European Union’s (EU) Carbon Border Adjustment Mechanism (CBAM). The CBAM will apply a carbon levy – mirroring the price of carbon in the EU’s cap-and-trade system – on embedded carbon in imports to the EU. In effect, this will extend the EU’s carbon market to the rest of the world.


What are carbon levies / carbon taxes?

A carbon tax sets a direct price on carbon by defining a tax rate on greenhouse gas emissions, or on the carbon content of fossil fuels. Carbon taxes capture some of the social costs of emissions that the public otherwise pays for, such as crop damage, health care costs, and property damage from flooding and sea level rise – and shifts the burden onto carbon emitters. In this way, carbon prices become a means of stimulating clean technology and market innovation.


In the panel, Mr. Pasquale De Micco, Policy Officer at the Directorate-General for Taxation and the Customs Union, a part of the European Commission, shared that the EU will be releasing its CBAM legislative package proposal in July. Crucially, Mr Micco emphasised that the CBAM aims to address the problem of carbon leakage – when businesses shift their operations to countries with laxer climate policies, leading to higher emissions, essentially kicking the can down the road.

Mr Micco also explained that the agriculture industry is unlikely to be included in this proposal, as the EU is focusing on the most carbon-intensive industries, that comprise 40% of emissions. Nevertheless, with the CBAM’s stated aims to raise global climate ambition and prevent carbon leakage[ix], it is expected that should the proposal be adopted, the CBAM will eventually be extended to all sectors.

The prospect of carbon levies will create business risks as profit margins stand to be impacted by rising carbon prices. But businesses will also have the opportunity to lay the groundwork that will enable them to thrive in a decarbonising world, through strong emissions reduction targets and immediate action.


Turning risk into opportunity

From the revitalisation of nature-based solutions in Southeast Asia, to shifting regulatory environments, the world is making a bigger bid for climate action than ever before.  As governments and corporations awaken to the imperative of climate action businesses must adapt to changing risks, while capitalising on new opportunities.  This has always been aligned to Paia’s approach, to help companies assess and manage the risks, and opportunities, that ESG, and climate change, pose to businesses.



Paia is a team of dedicated sustainability specialists, providing advisory on the business risks and opportunities that sustainability issues pose, and how best to apply those within existing company structures and strategies. To enquire about how we can help you, speak to us today at

[i] Market for carbon credits shows signs of recovery – The Straits Times

[ii] Indonesia pushes to restore peatlands and mangroves at the center of the climate crisis – ASEAN Today

[iii] Indonesia renews peat restoration bid to include mangroves, but hurdles abound – Mongabay

[iv] With stories and puppets, environmentalist battles to save Indonesia’s mangroves – CNA

[v]  DBS, SGX, Standard Chartered and Temasek to take climate action through global carbon exchange and marketplace – SGX

[vi] Nature and Net Zero – World Economic Forum

[vii] What are Nature-Based Solutions? – NUS Centre for Nature-based Climate Solutions,well%2Dbeing%20and%20biodiversity%20benefits.

[viii] A blueprint for scaling voluntary carbon markets to meet the climate challenge – McKinsey

[ix] Carbon levy on EU imports needed to raise global climate ambition – European Parliament

Image by enriquelopezgarre from Pixabay

Financing a Green and Inclusive Recovery

Financing a Green and Inclusive Recovery

By Zenia Chang

How can we build back better?

Plagued by the COVID-19 pandemic, Singapore’s economy shrank by 5.4 per cent in 2020 – the first annual contraction since 2001 and the worst recession since independence in 1965.[1] Uncertainty has arisen from COVID-19 and climate risks, but governments and corporations alike are committed to building back better sustainably and resiliently.

Sustainable finance will underpin our recovery, through investments in technology, innovation, and research for climate and sustainability solutions.


Sustainable finance, explained

But what is sustainable finance? Sustainable finance refers to schemes and initiatives that have the common goal of providing or facilitating capital for climate and sustainability solutions. Sustainable debt in a green market is issued in several instrument types:

Green Bond Proceeds* used to finance projects and activities that benefit the environment.
Green Loan


Any type of loan instrument made available exclusively to finance or re-finance, in whole or in part, new and/or existing eligible green projects.
Sustainability Bond Proceeds are exclusively used to finance projects that bring clear environmental and social-economic benefits.
Sustainability-Linked Bond


Bonds** in which issuers are committing explicitly (including in the bond documentation) to future improvements in sustainability outcomes within a predefined timeline; proceeds are intended to be used for general purposes, as compared to sustainability bonds.
Sustainability-Linked Loan Loan with a mechanism linking discounts or premiums applied to interest rates to a borrower’s ESG rating or other sustainability metrics.[2]
Social Bond


Proceeds used to finance projects achieving positive socio-economic outcomes for an identified target population, with a neutral or positive impact on the environment.

*Proceeds refer to the cash received from the sale of a good or product.
**Bonds refer to units of corporate debt issued by companies and securitised as tradeable assets.


Sustainable finance is an urgently needed solution

If no mitigating actions to combat climate change are taken, the IPCC (Intergovernmental Panel on Climate Change) projects that the world’s temperature will increase by 2 to 3.2 degrees Celsius mid-century.[3] In the worst-case scenario of temperatures rising by 3.2 degrees, Swiss Re forecast global GDP could fall by 18 per cent,[4] and that countries in Southeast Asia will be most negatively affected, as they would be the least equipped to mitigate climate change effects. Singapore is the exception[5], emerging amidst rapid growth in the Asia-Pacific region as a leader in climate resiliency and well-positioned to help the region achieve more sustainable growth.

Yet, even in Singapore, COVID-19 highlighted the disparity between the rich and the most vulnerable communities. Both the public and private sectors in Singapore have committed to pathways towards inclusive, sustainable development and decarbonisation as a means of recovery and climate change action. One such pathway is sustainable finance.

“Green finance is a natural solution to inequality.”

Sopnendu Mohanty, Chief Fintech Officer at the Monetary Authority of Singapore

Policymakers are increasingly recognising the value of green finance in public issues, from solving inequality to the creation of opportunities for small and medium enterprises (SMEs). During SGInnovate’s webinar, hosted together with the Embassy of Switzerland on 27th April, Mr Sopnendu Mohanty, Chief Fintech Officer at the Monetary Authority of Singapore, stated that green finance is a natural solution to inequality. According to Mr Mohanty, for developing countries seeking to transition to a low-carbon and sustainable economies, financial hubs like Singapore and Switzerland are primed to facilitate this wave of change. He underscored that Singapore is positioned to provide direct capital particularly to ASEAN countries for affordable sustainable solutions.

Adding on, Christoph Baumann, the Deputy Head of Insurance and Risks at the Swiss State Secretariat for International Finance, shared that Switzerland focuses on three pillars in its approach to sustainable finance: carbon pricing, transparency, and green FinTech. Baumann believes that “the climate transition leads to opportunities and can have great benefits for small and medium enterprises. We need to promote an ecosystem in which small companies (that innovate) can thrive.”


Sustainable finance is gaining momentum

Despite or perhaps in response to the COVID-19 pandemic, sustainable debt issuance broke annual records and totalled US$732 billion in 2020, with a significant increase in social and sustainability bonds (see the following figure).

Global Sustainable Debt Annual Issuance, 2013-2020

Global sustainable debt annual issuance 2013-2020

Source: BloombergNEF, Bloomberg L.P.

Moreover, it has just been ascertained that the first quarter of 2021 saw a record USD$231 billion in green, social and sustainability bonds – three times than the first quarter of 2020. In particular, social bond volume hit a new high, following the trend and focus on the social aspect of recovery. According to Moody’s Investors Service, “social bonds will remain a fixture of the sustainable finance space over the long term as governments and companies increasingly focus on a broader array of social issues.”[6]

Social bond volume hits new high on pandemic response efforts

In Singapore, the government and private companies have shown leadership in sustainable finance, visible through public policy commitments[7] and business strategies.


Singapore’s public policies now encourage sustainable finance

Earlier this year, the Singapore government revealed its 2030 Green Plan with ambitious targets in all aspects: creating a city in nature, an energy reset, sustainable living, a green economy, and a resilient future.[8] Singapore’s vision for a green economy includes:

  • An Enterprise Sustainability Programme, which helps enterprises – especially small and medium-sized enterprises, the most significant contributors to Singapore’s GDP – embrace sustainability and build resiliency capacity.
  • Business and job opportunities in Green Finance, verification, credits trading, and risk management.
  • Becoming the leading centre for Green Finance in Asia and globally by fostering the development of green financial solutions and leveraging innovation and technology.
  • The Research, Innovation and Enterprise Plan 2025, which will promote homegrown innovation and attract companies to anchor their research and development activities in Singapore to develop new sustainability solutions.

The 2030 Green Plan builds upon Prime Minister (PM) Lee Hsien Loong’s remarks that Singapore may be small and lack natural resources, but can push forward with tech and policy solutions towards sustainable progress, including the development of a green economy.

At the Leaders’ Summit on Climate in April, PM Lee elaborated on this sentiment, stating, “This (the green investments programme) will support the development of carbon trading and services, sustainability consultancies and environmental risk management. One promising area is emissions verification, including the use of new technology to measure the carbon footprint as well as monitor the abatement commitments businesses have made.”

Another significant policy initiative is the MAS Sustainable Bond Grant Scheme, already proven successful in uptake,  which encourages the issuance of green, social, and sustainability-linked bonds. MAS believes that these green bond issuances can allow companies to meet environmental, social, and governance objectives, diversify their investor base and achieve long-term pricing advantage. MAS also started work on Project Greenprint: FinTech for an Inclusive Society and a Sustainable Planet. Mr Mohanty, during the SGInnovate webinar, said the projects aims to create a marketplace where SMEs can find investors, seek advice, and analyse and monitor their sustainability targets.


More opportunities for sustainable solutions in the private sector

This past April, Temasek and BlackRock jointly committed US$600 million to invest in firms with carbon emission-reducing products and technologies such as emerging fuel sources, grid solutions, battery storage, and electric and autonomous vehicles. The partnership, called “Decarbonization Partners,” also has a fundraising target of US$1 billion for its first fund and will raise third-party capital.

With the intention of helping to “define climate solutions as a standalone asset class”, Decarbonization Partners is part of an accelerating recognition that the finance industry stands to gain from sustainable investments.

According to the Asian Development Bank’s (ADB) 2021 report, incentives for the finance industry to channel capital into environmental and social impact investments include better stock performance and pandemic resilience, amongst others:

During a 16-day period encompassing the announcement of green bond issuance, issuing firms’ common stocks post an average cumulative abnormal return of 0.5%, or an annualised gain of 7.9%. Such positive reaction indicates that investors see green and social finance creating value. Recent evidence from global markets shows firms distinguished by their green bond issuance enjoying superior stock price performance and greater resilience during the pandemic. Further, such positive investor recognition helps to broaden the investor base for green and social investment.

Furthermore, green bonds may even enjoy a cost advantage over bank loans:

In 2020, Alonso-Conde and Rojo-Suárez conducted an evaluation of financing with green bonds versus conventional bank loans: investments financed by green bonds earned higher internal rates of return for shareholders. Higher return was driven by the lower financing costs of green bonds relative to bank loans.

With the finance industry pivoting towards sustainable investments, there are more opportunities than ever for companies to hedge and mitigate sustainability risks, stay aligned with changing stakeholder preferences and social norms, and foster greater resilience to market shocks –  such as the COVID-19 pandemic.


Paia Consulting can help clients capture opportunities in sustainable finance
Channelling capital into investments with positive environmental and social impacts will help Singapore get on track to recover from COVID-19 and pave the way to a sustainable future. As the leading sustainability consultancy in Southeast Asia, Paia Consulting supports organisations by advising on:

  • The issuance of green bonds as defined by the leading global frameworks for these bonds (e.g. International Capital Market Association (ICMA))
    • Sustainability bonds come with more reporting and verification requirements than regular corporate bonds. Paia can ensure a company complies with ICMA principles and produce an assurance report.
  • Sustainability factors when formulating a company’s financial strategy and policy
  • How to maximise the value of a company’s sustainability strategy by improving a company’s rank with rating agencies, such as Sustainalytics and Bloomberg.

In the face of global crises, such as the COVID-9 pandemic, climate change, and economic recessions, organisations must innovate, collaborate, and invest or seek investment. Paia is well-positioned to advise you on this journey.

Innovation, collaboration, and investment will help individuals and companies face global crises – the COVID-19 pandemic, economic recession, and climate change – head-on and Paia can help you on that journey.



[1] Asian Development Bank. (2021). Asian Development Outlook (ADO) 2021: Financing a Green and Inclusive Recovery. Asian Development Bank. Singapore’s GDP contracts 5.4% in 2020 – CGTN.

[2] Sustainalytics.

[3] Intergovernmental Panel on Climate Change. (2014). Fifth Assessment Report. (Representative Concentration Pathway 8.5).

[4] Guo, J., Saner, P., Swiss Re Institute, & Kubli, D. (2021, April). The economics of climate change: no action not an option. Swiss Re Management Ltd.

[5] Ibid.

[6] Parker, Gillian. (2021, May).

[7] Monetary Authority of Singapore’s (MAS) Green Finance Action Plan.

[8] Singapore Government Green Plan.

Feature Photo credits: by Micheile Henderson on Unsplash

Harnessing natures innate power to address the climate crisis

Earth Day special – Harnessing nature’s innate power to address the climate crisis

By Ho Ning Li

In 2019, the United Nations Environment Programme released a New Deal for Nature, calling for “transformations to recalibrate humanity’s relationship with nature, and harness nature-based solutions for climate change” [1].


Nature-based solutions can provide up to 37% of the cost-effective carbon dioxide mitigation needed through 2030 to prevent average global temperatures from rising more than 2 degree Celsius above pre-industrial levels [2]. Nature-based solutions include green and blue infrastructure initiatives such as forest and wetland restoration, climate-smart agriculture and urban greening. These initiatives accelerate the amount of carbon dioxide and other greenhouse gases that plants and soils sequester, hence mitigating the warming effect in the atmosphere.


Adaptation to climate change impacts is also a key benefit of nature-based solutions. Besides being effective carbon sinks, healthy ecosystems can significantly reduce the impact of climate-related natural disasters such as floods, storms and droughts [3]. For example, mangroves and coral reefs can protect coastal communities from rising tides and storm surges. In Singapore, the government plans to employ mangrove restoration in addition to building polders and dykes to tackle rising sea levels [4].


According to the United Nations (UN), coral reefs are expected to reduce damages from storms by more than US$4 billion annually [3]. Natural ecosystem’s ability to regenerate also means reduced maintenance costs compared to man-made structures such as sea walls.


The value of nature is increasingly recognised, not just for climate change mitigation and adaptation, but also due to our dependence on ecosystem services. The collapse of natural ecosystems and biodiversity loss will devastate economies and livelihoods and threaten the survival of mankind. In the World Economic Forum’s 2020 Global Risks Report, “biodiversity loss” was ranked by leaders in business, government and civil society as one of the top five threats to humanity in the next 10 years [5].


The UN, in its New Deal for Nature, has called for a global commitment to implement natural capital accounting in Systems of National Accounts by 2030. In March 2021, a landmark framework was adopted by the UN to integrate natural capital, such as forests, wetlands and other ecosystems, in economic reporting [6]. The framework — the System of Environmental-Economic Accounting—Ecosystem Accounting (SEEA EA) marks a major step towards addressing the inadequacies of the traditional gross domestic product (GDP) for economic reporting.


For businesses, natural capital reporting and disclosure of nature-related risks and opportunities will be increasingly expected. A Taskforce on Nature-Related Financial Disclosures (TNFD), similar to the Taskforce on Climate-Related Financial Disclosures (TCFD) framework, is in the works and will be finalised in 2023 [7].

Nature is an intangible capital to be harnessed, but more importantly, to be protected.



[1] A new deal for Nature – United Nations Environment Programme (UNEP)

[2] We are at a critical point for the future of the planet – The Nature Conservancy

[3] On Earth Day, harnessing the power of nature to heal herself – United Nations Development Programme (UNDP)

[4] Explainer: Why we need to use nature in the fight against climate change – Today

[5] New Nature Economy Report Series – World Economic Forum

[6] UN adopts landmark framework to integrate natural capital in economic reporting – United Nations Department of Economic and Social Affairs

[7] Why a Taskforce is needed – Taskforce on Nature-related Financial Disclosures

Image credits: Photo by Timothy K on Unsplash


President Biden signs an executive order on the Paris climate agreement

What Biden Re-joining the Paris Agreement Means for Climate Action

By Nicole Lim

As you may have heard by now, newly inaugurated President Biden returned the United States to the Paris Agreement. This will officially take effect in 30 days. The President also signed executive orders [1] overturning some of Trump’s other policies that had environmental implications, including putting a halt to the controversial Keystone XL pipeline.

Since Biden first announced [2] that re-joining the Paris Agreement would be one of his first moves in office, many have been anticipating this day. For climate action and for many other reasons, today was a day that marked the beginning of a new era.

But beyond the politics and symbolism of it all, we wanted to take a look at what this all means for climate action and sustainability.

Ambition, leadership and science

As world’s second largest emitter of greenhouse gas emissions (GHG), behind China, the U.S. re-joining the Paris Agreement must come with bold and decisive commitments and plans to significantly reduce GHG emissions. When the U.S. first joined the Paris Agreement under the Obama Administration, the U.S. had pledged to reduce emission levels between 26-28% by 2025 from 2005 levels. At present, it is not on track to reach those goals.

Much has changed since then, and Biden will now be expected to raise the bar by setting more ambitious targets that capture its “fair share” of emissions. Not only that, with China announcing its commitment to be net-zero by 2060 [3], the E.U. to be the same by 2050 [4], and many other net-zero commitments by strong Asian economies, the pressure is on for the U.S. to take on an increased leadership role.

Thankfully, science, as Mr. Biden indicated in his executive order, would guide U.S.’s climate action.


It is, therefore, the policy of my Administration to listen to the science.

Executive Order, 20 Jan 2021

Therefore, we can minimally expect that Washington will set targets in line with the Intergovernmental Panel on Climate Change’s (IPCC) guidance on reducing GHG emissions by 45% by 2030 (from 2010 levels) and reaching net-zero by 2050.

Organisations and corporations often adopt or align with national climate targets. With the U.S. being a crucial player in the global economy, their targets send signals and inform how the private sector globally might respond to climate change.

Climate finance and pricing carbon

A striking feature of Mr. Biden’s executive order was Sec. 5.  Accounting for the Benefits of Reducing Climate Pollution. It requires all agencies to capture the full costs of GHGs through incorporating the social cost of carbon” (SCC), “social cost of nitrous oxide” (SCN), and “social cost of methane” (SCM) into cost-benefit analyses in decision-making. To facilitate this, the President has established an Interagency Working Group on the Social Cost of Greenhouse Gases, led by economists and scientists.

The Working Group has been tasked to publish an interim SCC, SCN, and SCM within 30 days (by 21 February 2021), and establish a final SCC, SCN, and SCM no later than January 2022. These costs will be used by agencies in valuing GHGs from change in regulation and other relevant agency actions. The Working Group will also be providing recommendations to the President on where and how these costs can be applied in decision-making.

Mr. Biden also made clear that these costs are to “reflect the interests of future generations in avoiding threats posed by climate change”.

The President also has a $2 trillion plan to invest in the transition from fossil fuels to clean energy [5]. This plan will see the transformation of the U.S. automotive industry to produce increased zero-emission / electric vehicles, green infrastructure, carbon-neutral power, energy-efficient buildings, investment in green innovation, clean agriculture and job creation. Since Biden’s announcement, stock prices of ESG companies that stand to benefit in a decarbonised world have soared [6]. We can expect to see these sustainable, ESG-focused companies to be at the forefront in the coming years.

Ahead of stronger sustainability and ESG regulation, companies are already bracing themselves for increased expectations [7], and some trade groups and organisations have begun meeting with the Biden team to review ESG matters and potential risks.

Outside U.S. shores and as part of commitments under the Paris Agreement, the U.S. will also be expected to play a big role in helping developing nations finance a fair, just and equitable shift away from carbon-intensive industries and fossil fuels.

Moves to watch

So much today, but it is only the beginning. Moving ahead, there are many developments to look forward to.

With COP26 around the corner, it is likely that we will see the U.S. and its newly assembled team of climate experts [8] convene with other leaders to ramp up ambition and align action ahead of the COP. In light of many other nations committing to a green transition, will we see unity and global solidarity like we saw in Paris? Backed by green technologies and corporate ambition, will world leaders take bolder action?

Come 21 February, the Working Group will announce an interim SSC, SCN, and SCM. Based on the Obama administration’s formula, the price per ton would now stand at $52. However, Trump officials reduced it to between $1 and $7 per ton. Economists believe that the Biden administration’s price might start at $125 per ton to better reflect latest climate science and market realities. [9] We can expect the price that Washington sets to impact analysts’ valuation of companies, which will be carefully watched by investors.

By 1 February, the Biden administration has promised additional executive actions to address the climate crisis. Subsequently, the $2 trillion climate package is expected to be passed. With so much optimism surrounding this, it remains to be seen if they will live up to expectations and deliver the action needed in our race towards a decarbonised future.


These series of events have instilled hope, inspiration, and ambition. The global pandemic has awakened the need for change, we are optimistic that the world will embark on an acceleration of climate action like never before.


What does this all mean for your organisation? Paia helps companies build resilience against climate change and increased expectations to decarbonise. Over past two decades, Paia has been supporting leading corporations across the region to prepare for a decarbonised future through strategically integrating climate and ESG considerations into business. Do speak to us to find out more.











How are Singaporean Companies Disclosing on the SDGs in 2020

How are Singaporean Companies Disclosing on the SDGs in 2020?

Research by Paia, November 2020

The SDGs (or Sustainable Development Goals) are 17 goals containing 169 targets that all countries (including Singapore) have signed up to meet by 2030 to address inequality, hunger and tackle climate change (amongst other things).

To achieve the goals, the private sector undoubtedly needs to play a significant part. Just like other ESG endeavors, private sector contribution to the SDGs represent a huge business opportunity.

In Asia alone, business leaders can unlock an estimated US$5 trillion and generate 230 million jobs, by pursuing strategies aligned with the Global Goals[1].

Globally, there are economic opportunities across 60 “hot spots” that are worth up to US$12 trillion, with a potential to create 380 million jobs by 2030.

Through our independent research, Paia has taken a look at how the top 100 SGX-listed companies are performing against the SDGs, and identified where more action is needed.


SD Whats?

In 2015, the United Nations set an agenda to address global environmental, social, and economic challenges such as social and economic inequalities, hunger, environmental degradation, and climate change.

17 ‘Sustainable Development Goals’ (SDGs) were agreed by all countries – with each country developing specific plans to address each goal (and the associated targets) based on their stage of economic development.

These 17 goals supersede the 8 Millennium Development Goals identified in 2000 to tackle global poverty.


Our approach

It has been 5 years since the goals were agreed. How well are Singaporean companies doing in incorporating these goals into their company’s strategic sustainability initiatives as well as their day to day business?

To answer this question, we examined the annual or sustainability reports of the top 100 Singaporean companies listed on the Singapore Exchange (SGX) (by market cap, as of April 2020) to see if they were reporting on their contribution to the SDGs, and if so how well?


How are Singaporean companies doing?

We found that 57 out of the 100 top SGX listed companies incorporated SDGs into their sustainability or annual reports (Figure 1). This is a 23% increase from last year, where only 34 out of 100 top SGX-listed companies (as of early 2019) reported on the SDGs.

Companies were considered to have identified the SDGs if they have mentioned specific Goals the company can and/or is able to contribute to through their operations/business activities.

Proportion of top 100 SGX companies reporting on SDGs

Figure 1


The three SDGs which featured most consistently in the 57 companies reporting include:

  1. Decent Work and Economic Growth (SDG 8),
  2. Climate Action (SDG 13); and,
  3. Good Health and Wellbeing (SDG 3)

Last year, interestingly, the top three SDGs reported on were, SDG8, SDG12 and SDG 13 – holistically covering economic, environment and social aspects. Particularly, the increased focus and alignment with SDG 3 is timely as companies and the world attempts to recover from a global pandemic. Going forward, we can expect greater alignment to climate action as Singapore increasingly positions itself as a global hub for low carbon solutions and climate finance.

Figure 2 below shows the number of times each of the 17 SDGs were referenced by the 57 companies who incorporate SDG information in their sustainability/ annual report.

SDGs Identified by Top 100 SGX Companies

Figure 2

What can we conclude?

There is definitely improvement from previous years on SDG reporting. With less than half of the top 100 SGX-listed companies reporting in 2019, to there being close to 60% of companies reporting on the Goals this year.

Incorporating SDG related activities into company reporting is voluntary. The fact that 57% of the top SGX companies mentioned the SDGs is commendable.

Companies also reported they were working on initiatives aligned with the SDGs, even if they did not mention these initiatives explicitly. Many companies also stated they intend to incorporate SDGs into their future reports.

However, Singapore companies could do well to better align to Goal-specific targets, such as the 13 targets for Goal 3, listed in Figure 3. Each target under the SDGs also contain various indicators that might be helpful for companies and organisations to include in their reporting, or have strategic oversight for.

Targets of Sustainable Development Goal 3 to ensure healthy lives and promote well-being for all at all ages

Figure 3. Targets of Sustainable Development Goal 3 to ensure healthy lives and promote well-being for all at all ages, WHO


Final Thoughts

As the COVID-19 pandemic continues to impact lives and livelihoods, many of noted the impact of the health, social and economic crises on the progress towards achieving the SDGs. This makes urgent action ever more necessary.

With less than 10 years left to achieve the Global Goals, businesses will need to work alongside government and civil society counterparts to pursue a Decade of Action towards 2030, through a collaborative approach.

[1] Better Business, Better World: Asia report (June 2017) by the Business & Sustainable Development Commission (BSDC)

Carbon Assessment – Shining a light on Scope 3 emissions

These emissions have typically been hidden from view, but are increasingly coming into the spotlight.

By Junying Lou

Increasingly, companies are starting to expand their focus on greenhouse gas emissions from their core operations under Scope 1 and 2 to also include greenhouse gas emissions from their value chain (Scope 3 emissions) to better manage climate-related risks and opportunities.


But what exactly are scope 3 emissions?

In short, Scope 3 emissions are everything other than emissions from companies’ direct operations and purchased energy.  This includes all indirect emissions from both upstream and downstream and can be classified into 15 different categories, as shown in the graph below.

Overview of GHG Protocol scopes and emissions across the value chain

Figure 1: 15 Categories of Scope 3 emissions (WRI & WBCSD, 2011).

Source: GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standard.


For most sectors, scope 3 emissions are far larger than scope 1 and 2 combined. The Carbon Disclosure Project’s (CDP) recent research shows that on average, companies’ supply chain emissions are 5.5 times greater than their scope 1 and 2 emissions (CDP, 2019).


Scope 3 calculation: a journey that has to start somewhere

Scope 3 measurement and management can be daunting for most companies because the data coverage is comprehensive while the data sources fall out of companies’ direct control. Collecting this data requires collaboration with companies’ value chain partners.  Paia typically advises companies to start by drafting a Scope 3 emission management plan to guide in screening the most material Scope 3 emissions, collecting relevant data and setting goals. Compared to Scope 1 and 2 emissions, the Scope 3 emissions quantification is more complex and uncertain and requires an iterative approach to refine data accuracy.


The next step: reducing scope 3 emissions

The end goal of knowing the full climate impact from across the value chain is to inform business decisions in what they purchase, produce and put into the market, and steer companies and their value chain to a sustainable direction.

Companies that have gained a robust understanding of their Scope 3 emissions can leverage different emission reduction approaches to minimise the climate impact in their value chain.

Best practices to reduce scope 3 emissions include implementing internal carbon pricing, extending product life span, procurement practices that prefer low carbon suppliers.  The table below shows carbon reduction approaches for each Scope 3 category, as recommended by the Science Based Targets initiative (SBTi).

Levers for reducing emissions by scope 3 category

Figure 2: Levers for reducing scope 3 emissions by category (Science Based Targets initiative et al., 2018)


So why should companies care about their Scope 3 emissions?


As more governments announce their plans to reach carbon neutrality, the risks associated with rapidly evolving energy and carbon regulations are mounting. For example, if a company sources carbon-intensive materials and products, the future energy and emission costs absorbed by suppliers can significantly increase the costs of goods paid by the company. For other companies that sell energy-intensive products, they may well expect more stringent energy efficiency regulations as well as negative consumer sentiment towards their products.

Additionally, companies may also face reputational and even litigation risks if they fail to understand the climate impacts in their value chain.


Where there is a risk, there is an opportunity. Through prudent Scope 3 emission management, companies stand to benefit from improved efficiency and substantial cost saving in their supply chain. CDP recently reported a total of US$19.3 billion annual supplier financial savings associated with actions to reduce carbon emissions (CDP, 2019).

Understanding scope 3 emissions also drives innovation along the value chain and helps companies build competitive advantages as the world decarbonises. Companies that can reap carbon reduction opportunities along the value chain and offer low-carbon solutions are more likely to enjoy an increased market share and enhanced customer loyalty in the resource-scarce future.


Closing thoughts

As countries and organisations look to build back better post-pandemic, many signs are pointing towards an increased focused on Scope 3 reporting. As many may be aware, 2020 saw a series of net-zero commitment announcements by countries and corporations. We can only expect that these commitments will trickle down along the value chain, impacting various companies.

Quantifying and managing Scope 3 emissions is challenging and we are here to help, contact us today to know more about Scope 3 emissions and how you can effectively measure and manage them.



CDP. (2019). CDP Supply Chain Report 2018/19.

Science Based Targets initiative, Navigant & the Gold Standard. (November 2018). Value change in the value chain: best practices in scope 3 greenhouse gas management.

World Resources Institute (WRI), & World Business Council for Sustainable Development (WBCSD). (September 2011). Corporate Value Chain (Scope 3) Accounting and Reporting Standard.

Sustainability and Decarbonisation in the Shipping Industry

Sustainability in the Shipping Industry – Road to Decarbonisation

By Nicole Lim

The shipping industry accounts for almost 3% [1] of the world’s emissions, and arguably accounts for the largest proportion of many organisations’ Scope 3 emissions. Yet, it is the most efficient form of transport of goods, compared to air, road or rail. More than ever, COVID-19 has shown the importance of shipping in preserving supply chains and transporting essential goods across the globe. With such a significant role to play, the shipping and maritime industry is key in ensuring the world meets climate goals set out in the Paris Agreement.


This year’s World Maritime Day was themed Sustainable Shipping for a Sustainable Planet, aimed at creating awareness of the UN SDGs and to create the opportunity for the industry to reflect upon the work done and the steps that can be taken towards a sustainable future. This comes as the industry takes big strides to move towards a decarbonised future.

In 2018, the International Maritime Organization (IMO) developed an initial strategy on the reduction of greenhouse gas (GHG) emissions from ships, which lays out key targets and signals for the industry to follow. Referred to as IMO2050, this strategy is ambitious, with the following goals:

  • Reduce CO2 emissions intensity by at least 40% by 2030, pursuing a 70% reduction in 2050 [2]
  • Absolute reduction by at least 50% by 2050, pursuing efforts to phase them out by the end of the century, consistent with the Paris Agreement

IMO strategy for reductions in GHG emissions from shipping

Figure 1. GHG emission gap between IMO GHG strategy and BAU emissions (DNV-GL 2019) [3].



IMO actions to reduce GHG emissions from shipping

Figure 2. Illustration of overall GHG reduction pathway to achieve IMO2050, taking into account a wide list of short-, mid- and long-term measures.

Source: IMO Action to Reduce GHG Emissions from International Shipping


To bridge the emissions gap (Figure 2) and the IMO2050 goals, the maritime industry would have to develop solutions that do not yet exist today – from new fuels to better ship design and to better ways of operating.


Challenges faced today

While IMO2050 is a strong signal to the industry and definitely sets the right path forward, there is still a long way to go from where the shipping industry stands today.

Shipping is a capital-intensive industry. Ships, in particular, require a large amount of capital upfront and coupled with the long lifespan of ships. This creates lock-ins for shipping companies and can pose as a significant challenge to change.

Alternative fuels and new technologies are seen as vital and almost central to cutting emissions from ships. Many of the low-emission solutions needed are still untested, and there is a need for financing and initial investments to co-fund or pay for the development and implementation of such solutions. However, there is presently a lack of incentives and push to channel such financing to the industry.

Finally, the industry consists of a complex network of actors, with a largely fragmented ownership of the world’s shipping fleet. The world’s top 10 ship owners make up less than 20% of global capacity, with the remaining 80% of the fleet owned by smaller ship owners with a few ships each. Then there are other actors in the value chain, such as engine manufacturers, ship builders, ship managers and so on – often with a similar structure of fragmentation [4]. This hence makes it very difficult to get consensus and achieve industry-wide standards as well as transparency.

Transparency, particularly for GHG emissions, is especially important for decision-making for financing solutions and green investments.


Opportunities and Singapore’s Role

However, with every risk and challenge, comes an opportunity. Singapore is well placed to seize the opportunities and lead to way towards decarbonisation of the shipping industry.

Singapore is one of the world’s busiest ports and is the leading maritime capital of the world [5].


As a leading maritime capital and one of the world’s busiest ports, Singapore has a role to play to set standards and regulations for the industry, such as in pushing for greater alignment and transparency in emissions disclosures.


As a financial hub, Singapore is well placed to create green financing mechanisms for the shipping industry. This year, many Singapore-based companies have been making headlines for successful implementation of various sustainable finance agreements [6], [7], [8], [9].


As a sustainability leader (on many fronts), Singapore’s strategic geographical location is its biggest natural resource, and it is only appropriate that the sustainability agenda is reflected in its maritime sector as well.


Singapore is on the right track – Next year, the Maritime Port Authority (MPA) of Singapore will launch the Maritime Singapore Decarbonisation Blueprint 2050, which will set out strategies to achieve a sustainable maritime Singapore. MPA has also launched its Maritime GreenFuture Fund, worth $40 million, to create ecosystems for the test-bedding of low-carbon technologies [10].

This sends a strong signal to the industry that Singapore is prepared and ready to seize the various opportunities that come with moving towards decarbonisation.


Paia has strong expertise in climate change and carbon management strategy. We assist clients with carbon profiling, accounting, reduction and reporting. Paia has worked with key players in the Singapore maritime sector, including government bodies, and is well-placed to assist shipping companies with their climate change and carbon strategy and reporting. Do reach out to us if you would like to find out more.


[1] IEA Energy Technology Perspectives 2017

[2] Intensity calculated as CO2 emissions per transport work

[3] Maritime Forecast to 2050, Energy Transition Outlook 2019

[4] Decarbonising Shipping: All Hands on Deck

[5] The Leading Maritime Capitals of the World 2019

[6] CapitaLand obtains S$500 million sustainability-linked bilateral loan – the largest in Singapore’s real estate sector, 28 May 2020

[7] CIMB and Starhub Ink RM270M Sustainability-Linked Loan Agreement, 19 September 2020

[8] Deutsche Bank and Olam International close Asia’s first FX Forward using ESG performance targets, 26 June 2020

[9] NUS raises S$300 million in its inaugural green bond issuance, 27 May 2020

[10] Speech by Senior Minister of State for Transport and Health Lam Pin Min at The Ministry of Transport’s Committee of Supply Debate 2020 Sustainable & Competitive Industries and Sustainable Environment with a focus on Aviation, Maritime and Active Mobility, 5 March 2020

Chinas carbon neutral target 2060

China’s 2060 Carbon Neutral Target – Challenges and Opportunities

By Adrian Pang

China announced recently that the country pledges to speed up emissions reductions to reach carbon neutrality by 2060. The announcement by the Chinese president was a pleasant surprise for many experts, who along with environmentalists, welcomed the news and opined that this significant step by the world’s largest polluting nation will significantly slow climate change. Some even called the announcement “the most significant climate policy move for years” (China’s carbon neutral pledge could curb global warming by 0.3 degrees Celsius: Researchers, 2020). Researchers from Climate Action Tracker said the move could curb global warming by 0.2 to 0.3 degrees Celsius this century if China achieves the target (China going carbon neutral before 2060 would lower warming projections by around 0.2 to 0.3 degrees C, 2020). Under this goal, China also pledged that its emissions would peak before 2030 before undergoing drastic reduction until 2060.

China carbon neutral targetChart for illustrative purposes only. Source: Paia Consulting

This is a significant milestone as the country is the biggest carbon emitter in the world. Prior to the announcement, China was reserved in its long-term commitment to carbon neutrality. The country’s previous goal was to reach emissions peak by 2030 at the latest. As the largest emitter in the world, China accounts for 28% of the world’s emissions (Myers, 2020). This figure dwarfs the proportion of total emissions – 11% of the over 60 countries that pledged to achieve carbon neutrality by 2050 in 2017 (Sengupta & Popovich, 2020). With China’s commitment, the world might witness a nearly 40% carbon emissions reduction between 2050-2060. However, as with many of the aforementioned 60 countries, China also did not specify how it plans to achieve the targets. At present, these question marks will continue casting shadows on China’s ambition until the country set out a solid action plan with near- and long-term targets. Even so, it is obvious a critical area of focus would be its energy scene. Here, we look at China’s energy landscape to examine challenges and opportunities while awaiting the plans from the government.

Challenges: Energy Revolution Still in the Pipeline

The sector with perhaps the biggest role to play is the energy sector. China still relies on fossil fuels for about 85% – with coal at 60%, of power production (Shepherd, 2020). This amounts to about half of the country’s carbon dioxide emissions from fossil fuels. While the rest of the world is gradually shifting away from fossil fuels, China’s emissions rose in 2018 and 2019. The setback was induced by  the country’s efforts to boost a sluggish economy. In 2020, Beijing has approved coal-fired power plants at the fastest pace since 2015 (Hale, 2020). There were more construction permits granted for these power plants in the first six months of 2020 than 2018 and 2019 combined. This is evidently to regenerate the economy devastated by the pandemic but at the detriment of progress made on cutting coal consumption. As a result, carbon emissions from China’s main economic activities – energy production, cement making, and industrial uses were 4% higher year-on-year in 2020. This is despite an overall 25% pandemic-induced reduction of emissions at the start of the year. Therefore, reversing recent and current energy and emissions trends is pivotal to kickstart the 40-year plan to carbon neutrality.

The country’s upcoming five-year plan is expected to spell out necessary economic, industrial, and environmental agenda. Experts speculate the plan would maintain a cap on coal power capacity as well as accelerate the production of 20% of electricity supply from renewable sources by 2030 (Shepherd, 2020). Experts from Bernstein Research have estimated that China needs to reduce fossil fuels consumption from the 85% of total energy mix to 25% to reach carbon neutrality (Zhou & Yep, 2020). Unfortunately, there currently are no substantial incentives for grid operators to buy renewables, casting the spotlight on needs to reform power pricing mechanisms.

Elsewhere, China’s Emission Trading Scheme (ETS) struggles to make an impression. Its ETS, which would eclipse the EU in size and accounts for a third of China’s national emissions, has been delayed several times (Temple-West, 2020). China’s ETS encountered difficulties in establishing a comprehensive data collection system that would allow policymakers to set target levels and allocate carbon credits accordingly (ibid). It was also scaled back to limit carbon credits trading to the power generation sector rather than the eight industrial sectors [1] in the original outline (ibid). The numerous setbacks to establish the scheme have been hampered by the pandemic-induced economic downturn as well as political uncertainties. There are also persistent doubts on the effectiveness of the trading scheme. Overall, there needs to be equitable contribution by the stringency of the coal power cap, enforcement of regulations, power sector reforms, political and social will, etc for a country of China’s scale.

Then, there is the conundrum of disrupting socioeconomic and socioenvironmental status quo to pave way for rapid transitions. This is a legitimate issue, as China currently has the biggest population in the world at 1.4 billion people. The 40-year commitment equates to rapid transformation within one generation of people. Thus, there are potential upheavals for people’s lives and incomes in a still-industrialising country. This is because social fabrics and fundamentals like energy consumption, food production, physical mobility and works will be radically affected.

Opportunities: Press on with Progress

On the country’s renewable energy development, China’s capacity now accounts for 30% of the world’s total. It is currently a leader in clean energy technologies where it is leading in wind turbines and solar panels production and installation. Therefore, one of China’s main opportunities is to press forward with current progress such as speeding up the transition to renewable energies for its industrial and commercial sectors. China has also shown that it has the capacity on other fronts. Aside from renewable energy infrastructures, China is also a global leader in batteries and electric vehicles productions.

While the ETS has faced repeated setbacks, a nationwide scheme is nonetheless taking shape. Eight regional authorities, including those from the most populous Beijing and Guangdong regions are piloting their own ETS albeit at much lower scales. These pilot schemes cover more sectors than the national scheme. They operate alongside the national scheme with a view to be incorporated into the national programme eventually (Temple-West, 2020). In the process, there should be no new coal-fired power plants

More importantly, China’s focus on expediting its carbon neutral commitment will have significant “spillover” effects on the global energy landscape and emission reductions. A good example is the decreasing solar panels prices all around the world due to China’s high demand for solar energy (Pollitt, 2020). This would result in higher adoption of renewable technologies worldwide – and higher emissions reduction in other parts of the world even if other countries do not implement new climate policies (ibid). China is also the world’s biggest energy financier and biggest market aside from being the biggest emitter. It is consistently the top investor in clean energy globally for nine out of the last ten years according to the Frankfurt School of Finance and Management (Campbell, 2019). It has invested heavily in many developing parts of the world such as South America, Africa and Asia. While political intentions might be cornerstones of many of such investments, China’s contribution remain significant from the environmental perspective, driving the global transition to renewable energy.

Finally, a significant opportunity for China is its own governance and regulations. The country should implement more significant economic measures targeting at energy and emissions intensive sectors still reliant on fossil fuels and coals. The country can also have stronger enforcement of laws against environmental offenders. That might see a significant shift away from current fossil fuel driven economic discourse and paradigm. Socioeconomically, creative destructions of technology, skills, and jobs such as those in coal extraction spurred by the energy revolution are inevitable (Pollitt, 2020). Thus, transformations require fine balancing acts by the government to ensure a smooth transition to clean renewable energy sources, such as creating new industries and jobs as well as subsidising infrastructural developments. This is to ensure the least disruption will be caused to the socioeconomic stability of its society.

In essence, China’s 2060 pledge is driven by encouraging progress in the renewable energy sector. Together with other major actions and policies shift such as strengthening the ETS and tailoring carbon neutrality into the next Five-Year-plan, it is possible for China to reach zero carbon by 2060. All eyes are indeed on China’s 14th Five-Year-plan. Their next course of action will be pivotal for the climate change trajectory in the next decades.

What do you think are the challenges and opportunities as we await China’s action plans to achieve carbon neutrality? Share your thoughts with us in the comment section.

[1] Power generation, steel and iron, non-ferrous metal, building materials, chemical industry, petrochemical industry, paper making, civil aviation



Campbell, C. (2019, November 1). China Is Bankrolling Green Energy Projects Around the World. Retrieved from Time:

China going carbon neutral before 2060 would lower warming projections by around 0.2 to 0.3 degrees C. (2020, September 23). Retrieved from Climate Action Tracker:

China’s carbon neutral pledge could curb global warming by 0.3 degrees Celsius: Researchers. (2020, September 24). Retrieved from Channel News Asia:

Hale, T. (2020, June 25). China expands coal plant capacity to boost post-virus economy. Retrieved from Financial Times:

Myers, S. L. (2020, September 25). China’s Pledge to Be Carbon Neutral by 2060: What It Means. Retrieved from The New York Times:

Pollitt, H. (2020, September 24). Analysis: Going carbon neutral by 2060 ‘will make China richer’. Retrieved from CarbonBrief:

Sengupta, S., & Popovich, N. (2020, September 25). More Than 60 Countries Say They’ll Zero Out Carbon Emissions. The Catch? They’re Not the Big Emitters. Retrieved from The New York Times:

Shepherd, C. (2020, September 23). China’s carbon pledge revives hopes of a climate game change. Retrieved from Financial Times:

Temple-West, P. (2020, June 5). China’s carbon trading scheme struggles to take off. Retrieved from Financial Times:

Zhou, O., & Yep, E. (2020, September 23). China’s carbon neutral pledge signals turning point for fossil fuel markets. Retrieved from S&P Global:

Towards net zero emissions

Towards net-zero emissions real estate in Asia

The following article first appeared on GRESB Insights

Massive wildfires in California, the worst flooding in China since the beginning of this new millennium, and the second most active Atlantic hurricane season on record – this is a snapshot of what a 1 °C warmer world looks like. Such extreme weather events have become more unpredictable in intensity and frequency year after year, and they are expected to become more devastating as the world gets warmer if we do not take immediate actions to drastically reduce greenhouse gas (GHG) emissions.

IPCC’s Special Report on Global Warming of 1.5 °C (SR15) makes it clear that it’s not too late to prevent the worst impacts of climate change, but there is no time to waste. To have a fair chance of limiting global warming to 1.5 °C, we need to halve global by 2030, achieve net zero CO2 emission by 2050, and achieve net zero on all GHG emissions by mid-2060s.

In addition to rapid and deep reductions in gross CO2 emissions (i.e. decarbonisation), pathways outlined in the IPCC Special Report also require ramping up of CO2 removals from the atmosphere. Some GHG emissions are difficult or impossible to be eliminated. For example, despite the impact of the COVID-19 pandemic, aviation and shipping are still expected to be major contributors of CO2 emissions in near future. Meanwhile, non-CO2 GHG emissions, such as refrigerant gases from buildings and methane from agriculture, will continue to contribute to climate change. Removal of these non-CO2 gases is not technologically feasible at the moment. In order to achieve a net zero emissions of all GHGs, the rate of CO2 removals has to exceed the rate of CO2 emissions past 2050 to offset residual non-CO2 emissions.

From a real estate industry perspective, achieving a net zero global target requires drastic transformations in how we design, construct and operate buildings. Currently, buildings consume 32% of global energy supply. With relatively longer life cycles measured in decades, developing zero energy and zero emission new buildings is especially important. Studies show that in order to achieve 80-90% reduction in building energy consumption by 2050, new constructions need to be near-zero energy by 2020. Further investments are also needed to retrofit existing buildings to the same level of energy efficiency.

Since the publication of the Special Report, more than 20 countries have adopted net zero targets. Some of these targets are published in policy documents, while others have been written into laws. With Europe leading the charge towards net zero targets, three Asian countries have made it to the list. Bhutan, which has been carbon neutral since early 1990s, pledged to maintain net zero emissions. Perhaps more meaningful examples come from Singapore and Japan. With much larger economies than Bhutan, both countries aim to reach net zero GHG emissions in the second half of this century. Collectively, however, these net zero targets only cover about 10% of current global GHG emissions. Corporate commitments to net zero emissions to support and supplement governmental actions are critically important.

Initiatives launched by industry associations, such as World Green Building Council’s Net Zero Carbon Buildings Commitments, have garnered meaningful support among developers and real estate investors. Adoption in Asia, however, has been relatively slow, especially in the rapidly growing markets of China, India and Indonesia. To date, there is only one Asian developer signatory from the Philippines.

In Singapore, efforts towards decarbonising real estate industry are mostly led by the public sector. As the national regulator, the Building and Construction Authority (BCA) piloted Southeast Asia’s first Zero Energy Building (ZEB) in 2009, and subsequently introduced Super Low Energy (SLE) and Zero Energy categories for the national Green Mark building certification scheme. Since then, the number of net-zero energy buildings in Singapore have grown to include the newly constructed SDE4 at National University of Singapore and seven retrofitted buildings on Nanyang Technological University’s (NTU) campus. In October 2019, Singaporean utility provider SP Group launched the first net zero emission building in Southeast Asia. Powered entirely by a solar and hydrogen energy system, the zero emission building is disconnected from the national electricity grid and generates zero GHG emissions during its operations.

SDE4 building on NUS Kent Ridge campus

SDE4 building on NUS Kent Ridge campus. Photo: NUS Office of Estate Development

So far, most net zero energy and carbon building programmes, including World Green Building Council’s Net Zero Carbon Buildings Commitments, focus on eliminating Scope 1 and 2 GHG emissions from the operations. In the construction industry, GHG emissions embodied in the construction materials are important emission sources as well, especially in fast growing Asia markets. The production of many construction materials, such as cement, steel and glass, have traditionally been a carbon intensive process, but some manufacturers are committed to change this.


Cement producer Heidelberg Cement and steel producer ThyssenKrupp have both committed to achieve net zero emission in their production by 2050, partially through carbon capture, utilisation and storage (CCUS). Beyond the production of building materials, world’s fifth largest construction company Skanska also committed to net zero emission target throughout its value chain by 2045. Other alternative solutions, such as use of bio-materials, have been piloted in Singapore. In 2017, NTU launched the first large-scale building in Southeast Asia constructed primarily with mass engineered timber.

The Wave at NTU is the first large-scale building in Southeast Asia constructed primarily with mass engineered timber

Image 3 The Wave at NTU is the first large-scale building in Southeast Asia constructed primarily with mass engineered timber. Photo: Wee Teck Hian/TODAY

As a natural extension of setting science-based emission reduction targets, the Science-Based Targets Initiative (SBTi) published a set of recommendations earlier this year to guide corporates in setting meaningful and effective net zero targets. Among other things, SBTi emphasises that corporate net zero targets should include all value chain emissions (Scope 1, 2 and 3). Reductions and eliminations of GHG emission sources within corporate value chain (abatements) should be prioritised over offset measures that either reduce emissions outside corporate value chain (compensation measures) or remove CO2 from atmosphere through bio-sequestration and carbon capture, utilisation and storage technologies (neutralisation measures). Corporate net zero targets should also include separate strategies and targets for abatements, compensations and neutralisations.

With pilot projects proving feasibility of new technologies and clearer guidance from SBTi on corporate net zero target setting, we can expect growing interest in net zero targets among real estate developers and investors. These efforts could be further supported by the growing market of green financing. In Singapore market, green financing in the real estate sector has grown more than seven-fold in the past 3 years. Combined with effective net zero targets, targeted green financing schemes could catalyse a transformation in Asia’s real estate and building markets.



  1. IPCC, 2018: Summary for Policymakers. In: Global Warming of 1.5°C. An IPCC Special Report on the impacts of global warming of 1.5°C above pre-industrial levels and related global greenhouse gas emission pathways, in the context of strengthening the global response to the threat of climate change, sustainable development, and efforts to eradicate poverty [Masson-Delmotte, V., P. Zhai, H.-O. Pörtner, D. Roberts, J. Skea, P.R. Shukla, A. Pirani, W. Moufouma-Okia, C. Péan, R. Pidcock, S. Connors, J.B.R. Matthews, Y. Chen, X. Zhou, M.I. Gomis, E. Lonnoy, T. Maycock, M. Tignor, and T. Waterfield (eds.)]. In Press.
  2. Kuramochi, T., Höhne, N., Schaeffer, M., Cantzler, J., Hare, B., Deng, Y., Sterl, S., Hagemann, M., Rocha, M., Yanguas-Parra, P. A., Mir, G.-U.-R., Wong, L., El-Laboudy, T., Wouters, K., Deryng, D., & Blok, K. (2018). Ten key short-term sectoral benchmarks to limit warming to 1.5°C. Climate Policy, 18(3), 287–305.
  3. Pineda, A. C., Chang, A., & Faria, P. (n.d.). Foundations for Science-Based Net-Zero Target Setting in the Corporate Sector. Retrieved 18 September 2020, from
climate change effects on singapore

Climate Change and Singapore – the Physical Impacts

By Adrian Pang

Sustainability or ESG is progressing in Singapore. The recent transformation to the Ministry for Sustainability and the Environment (MSE) from the previous Ministry for the Environment and Water Resources (MEWR) signalled a stronger intent and focus on progressing sustainability in the country. Minister Grace Fu recently expressed her excitement at Singapore’s potential in this realm. [1] She also spelled out some of the main focuses of MSE such as waste and resource management (circular economy and resource efficiency), renewable energies, digitalisation of processes and urban food security. Overall, she expects ample new job opportunities with more scientists, engineers, experts, and professionals needed to “fill in the gaps” created by growth of the sustainability sector [2]. She also urged businesses to capitalise on the current economic situation to revisit and revise their business models and plans to induce resilience and sustainability. She encouraged private entities to look past benefits and costs of externalities for the common good. Essentially, it should be “sustainability in the business and not just a part of business”. While such development is encouraging, the fight against climate change is a responsibility that must be borne by everyone. This is because Singapore, a tiny island nation is already at the forefront of climate change. On this note, let us provide ourselves with a reality check on the severity of climate change with a look at what is already happening on Singapore’s shores. Climate change is more personal than we think.

Running out of Land and Shelter

The biggest threat to the survival and even existence of this low-lying tiny island nation is obviously the rising sea level. During PM Lee’s National Day Parade address in 2019, he issued grave warnings on the adverse effects of sea level rises to Singapore. He emphasised that the country needs to “treat climate change defences like it treats the Singapore Armed Forces (SAF)”. This was visualised through a map of Singapore that highlighted the low-lying areas. Areas such as Changi, Jurong Island, Geylang, and Katong will submerge under water at this rate of rise. Even Bishan and Toa Payoh, situated at the heart of the country will be affected. While this is a projection, current climate data are showing it is fast becoming a reality. Scientists confirmed that the current sea level rise is the fastest in 6000 to 7000 years, with a 3.2mm annual increase in recent years. This rate translates to a 20cm to 30cm rise in 20 to 30 years [3]. As a tropical country on the equator, the sea level rise can be a “double whammy” to Singapore. Ocean water is warmer on the equator where water molecules would expand further, leading to higher level rises. Secondly, water from melted ice caps tend to flow to the equator due to gravity, contributing to an even faster rise relative to many other parts of the world [4]. We have already seen the vulnerabilities of low-lying Singapore. Recurring floods from 2010 to 2012 in the country’s central regions have incurred severe economic and business losses. Aggravating sea level rise, of which experts are predicting from 1m (conservatively) to 2.5m (a 1-in-20 risk scenario) would make Singapore more flood prone, unsafe, and even unliveable when reality sets in [5]. This proves that climate change is a problem that needs to be addressed now and aggressively. Singapore has sound adaptation measures, such as building the new Changi airport terminal at 5m above sea level with dikes, flood gates and underground water and drainage systems, etc. However, it remains to be seen how these solutions will perform.

Drying Water Taps

As the planet continues to warm, multiple places around the world are already suffering from increasing and worsening events of drought. Singapore’s multiple avenues of water resources have ensured the country remains water secure for now. But as drought seasons become more severe, prolonged and frequent, Singapore’s water security is under threat too. This situation is compounded by the fact that Singapore has always been classified as a highly water stressed area according to many scientific and geographical sources such as the World Resources Institute (WRI) [6]. Four of Singapore’s water sources are imported water, reservoirs, NEWater and desalinated sea water. The former two are at the mercy of the climate change and droughts, making them less reliable as climate condition degrades. That leaves Singapore to rely more on NEWater and desalinated sea water. However, both processes require on average 5 to 7 times more energy and incur higher costs compared to treating rainwater [7]. In the case of NEWater, there needs to be existing water sources to be treated and recycled which is not exactly a viable solution in the long term if droughts happen more frequently. On the other hand, there is the problem of water quality with desalinated sea water. Warming climates have seen algae bloom occurring more frequently and aggressively in recent years. However, the declining water quality is not matched by the filter technologies and infrastructures in place to treat the water. This would result in lower efficiency of the water filtration and treating system, thus less and of lower quality of water treated for consumption.

Broken Food Chains

Climate change is also critical to our food chain. Once again, Singapore’s status as a land- and resource- scarce island nation means that we have to import more than 90% of our food. Aggravating droughts and rising sea levels will affect global food production. Closer to home, Singapore’s food producing neighbours like Indonesia and Thailand are already feeling the effects of these two critical climate risks [8][9]. At the current trajectory, Singapore’s food chain would be severely affected from prices to quantity and quality, threatening the country’s food security. We have experienced such disruptions. In 2015, 55 fish farms in the Johor Straits lost about 600 tons of fish due to the problem of harmful algae blooms [10].  The then Minister of Environment and Water Resource (now MSE) Vivian Balakrishnan warned that this occurrence is “likely to be a recurrent problem with global warming”.

In a gradual but even more catastrophic development, rising temperature and increase of greenhouse gas emissions (GHGs) in the atmosphere are causing ocean water to become warmer and more acidic. As the ocean absorbs 90% of the heat in the atmosphere, the ocean too has warmed by 0.13 degree Celsius over the last 100 years [11]. Such a small increment is already detrimental to the marine ecosystem, especially coral reefs where warmer water means they will take longer to grow and recover. The expected increase in temperature and cases of heatwaves across the world will only exacerbate the situation. Ocean acidity is the evil twin of ocean warming. Like its heat absorbing abilities, oceans also absorb a significant one third of the approximately 22 tons of daily GHG emissions. The increase in emissions would increase water acidity where it degrades and kills coral reefs. Together, these two phenomena would devastate the marine ecosystem as it breaks down the food chain from the very first level. Smaller species that rely on coral reefs for food and habitat will slowly dwindle, causing a chain reaction that leads to fewer food sources on our tables.

Climate Change Affects Everyone

The information above is not intended to be alarmist but as a reality check on how far behind we are in the fight against climate change. This is meant to be a reminder to ourselves of the sheer weight of responsibilities each of us has, not just governments and big corporates. There are already signs that our livelihoods will be adversely affected. Basic necessities for survival – shelter, food and water in the already resource-scarce Singapore will be threatened even more by climate change. Singapore, a climate leader on many fronts, has many adaptation solutions in place. However, to truly fix the climate, the country has to lead on mitigation solutions as well.

Therefore, as the world battles the “once in a generation crisis” that is the COVID-19 pandemic, we must not relax on our fight against climate change whose effects that can last for generations.














carbon management step by step guide

Carbon management: a step by step guide

Using Apple Inc. as a case study

By Junying Lou


The world has witnessed a string of climate disasters in recent years. In the United States alone, there have already been 10 extreme weather events with losses more than $1 billion each in 2020 (NOAA, n.d). China is currently dealing with the worst flooding in more than 20 years that affected about 55 million people (He, 2020). Australia’s 2019-2020 bushfires have destroyed 2,000 homes and 11.2 million hectares, equivalent to nearly half the area of the United Kingdom (Green, 2020). The list could go on, there is no doubt that climate change has become more palpable for people around the world.

Climate scientists have confirmed that “human influence on the climate system is clear” and “warming of the climate system is unequivocal” (IPCC, 2014, p. 2). The urgency of climate actions has called for more effective carbon management from the public and private sectors.

Carbon management is about taking steps to measure and manage greenhouse gas (GHG) emissions within your organisation and extend the reduction of emissions across your supply chain (FDF, 2008, p.8).

What is in it for me as a business?

Saving the planet alone may not be a compelling enough reason for organisations to commit to carbon management. That is why it is important to highlight that carbon management does make a good business case in the following areas (Zhou, 2020, pp. 91-96):

  1. Cutting cost: carbon management will open up opportunities for organisations to identify cost-saving areas within and beyond its direct operations through improved energy and resource efficiency.
  2. Reducing regulatory risks: more and more countries are adopting ambitious climate targets which will translate to more stringent regulatory requirements for carbon emissions.
  3. Responding to stakeholders’ interest: increasingly stakeholders are showing interest in corporations’ effort to combat climate change.
  4. Improving competitiveness and promoting innovation: through the process to achieve ambitious carbon reduction targets, corporations will catalyse the transformation of operational practices and adoption of new technologies.

Getting started: setting up a management system

Setting up a management system for carbon management, which includes policies, processes, and frameworks will ensure the credibility of recorded data and results.

Just like any other strategic initiatives, it is imperative to obtain buy-in from the board and senior management. The leadership and oversight at the top level can help secure necessary financial and human resource for the effective implementation, evaluation, and continuous improvement of the organisation’s carbon management plan.

Cross-functional working teams from all levels of the organisation shall be formed with responsibilities clearly defined and allocated. Some common roles include collection, compilation, and reporting of emission data; management and monitoring of carbon reduction initiatives; and staff awareness and education. Other key internal processes, such as procedures to govern data quality, need to be put into place.

What are the key steps?

With support from a well-designed management system, an effective carbon management plan normally involves “measure- reduce- extend” (Cambridge Programme for Sustainability Leadership/Business in the Community, 2009, p. 4)

Step 1: Measurement

When it comes to management, we all heard about “what gets measured get managed”, and this is particularly true for carbon management. To develop an accurate baseline GHG inventory requires identification of emission sources and collection of activity data for conversion to emission data.

Before starting the actual measurement, organisations need to decide on a few things:

Standards to follow for the emission measuring purpose: the most commonly known standards to corporations are ISO 14064-1 and The GHG Protocol Corporate Accounting and Reporting Standard, but there are also other industry-specific standards available.

Organisational boundary: A corporation with a complex organisational structure, such as having multiple subsidiaries, joint ventures, associated companies, etc. needs to determine which parts of the businesses to be included. This largely depends on the approach it selects to consolidate GHG emissions: the equity share approach or the control approach (WBCSD/WRI, 2004, pp. 17-19).

  • Under the equity share approach, a corporation accounts for the share of GHG emissions from the operations according to its share of equity owned. This approach best reflects the risks and rewards a corporation is exposed to from a certain operation, but performance tracking of operations that it does not have control over can present challenges.
  • Under the control approach, a corporation accounts for 100% of the GHG emissions from the operations it has control over. The corporation needs to choose between either the operational control or financial control. While operational control is more compatible with government compliance programmes and more appropriate for performance tracking, this approach may not fully reflect the commercial reality of the reporting corporation.

Operational boundary:  The operational boundary (Scope 1, 2 and 3) is defined at the corporate level after the organisational boundary is decided, this step determines the scope of emissions to cover.

  • Scope 1 direct emissions are emissions from sources that owned or controlled by your corporation, including emissions from company-owned vehicles, boilers and furnaces, and emissions from chemical processes, etc.
  • Scope 2 indirect emissions are a special category of indirect emissions that are associated with the generation of electricity, heat, or steam that is purchased and used by the corporation.
  • Scope 3 indirect emissions are everything else, emissions that are a result of the activities of the corporation, including both upstream and downstream. Scope 3 is an optional reporting category, however, more companies are increasingly interested in measuring and managing their Scope 3 emissions. For example, Apple has been publishing its Scope 1, Scope 2, and Scope 3 carbon footprint in its environmental progress report.

Source: Apple’s Environmental Progress Report 2020

If it is your corporation’s first year in this journey, it means a lot of hard work that can be separated into the following oversimplified and broad categories:

  • identification of emission sources
  • collection of primary and secondary data including activity data and conversion factors
  • conversion to emission data
  • and compilation of all data to be reported at the corporate level

Step 2: Reduction

Once the baseline GHG inventory is set, it can be used to guide future actions. Organisations may also find it a golden opportunity to uncover emission hotspots during the measurement phase they wish to concentrate their reduction effort on.

The corporation may consider setting a carbon reduction target to demonstrate its commitment. The carbon reduction target can be absolute or intensity target. The latest development with target setting is the adoption of science-based target among leading companies. According to Science Based Targets initiative (SBTi), a science-based target is defined as targets “in line with what the latest climate science says is necessary to meet the goals of the Paris Agreement – to limit global warming to well-below 2°C above pre-industrial levels and pursue efforts to limit warming to 1.5°C.” (SBTi, n.d.)

It is also important to decide the boundary of your target. As a minimum, the target should be set for Scope 1 and Scope 2 emissions, but since for the majority of sectors, the largest portion of a company’s emissions is Scope 3 emissions (Labutong, 2018), many companies are looking beyond their core operations to set Scope 3 targets. Apple, for an instant, recently announced that it will be 100% carbon neutral for its supply chain and products by 2030. (Apple, 2020)

To achieve carbon reduction targets, a series of carbon reduction programmes shall be devised and implemented. It is worth noting that carbon reduction activities can range from free to very low costs, such as simple user behaviour change like switching off when not in use, to high costs, such as investment in energy efficiency equipment.

We use Apple as an example to explore the wide range of projects and programmes a corporation can consider for emission reduction purpose. The selective projects Apple implemented are discussed in the hierarchical order of carbon management, which is first to avoid or reduce emissions through conservation and efficiency, then to eliminate emissions by switching to renewable sources of energy, and lastly to sequester or offset any residual emissions. (Second Nature, n.d.)

RMIT Carbon Management Hierarchy

Source: RMIT University Carbon Management Plan

  • Avoid and Reduce

With an understanding of where the company’s biggest climate impact occurs, Apple prioritises low-carbon design of its products, at both manufacturing and product-use stages. The improved manufacturing processes that led to higher material efficiency, combined with the use of low-carbon materials like recycled materials, have reduced carbon emissions associated with Apple’s products, for example, it is reported that a 63% decrease in Apple’s aluminium carbon footprint is achieved compared to 2015.

Energy efficiency in Apple’s buildings is another focus area. It is reported that energy efficiency audits of buildings were conducted to identify system improvement opportunities, followed by energy efficiency measures. Apple estimates that its energy efficiency programme along with new building design can save about 7,500 metric tons of CO2e per year.

Apple’s At Home Advisor programme allows AppleCare customer service employees to work from their homes, and this single programme avoided nearly 22,000 metric tons of CO2e emissions in the fiscal year 2019. For other employees, Apple introduced a bus commute programme to reduce the use of single-occupancy vehicles and offer campus bicycles which resulted in an over 6,000 metric tons reduction in the fiscal year 2019.

  • Substitute

According to Apple’s report, it has generated or sourced 100% renewable electricity for its global facilities since 2018. The was achieved through Apple’s renewable energy programme, which took a blended approach that involves owning or investment in onsite and offsite renewable projects, entering into power purchase agreements, and purchasing market RECs. Since renewable energy has been the sole source of Apple’s electricity, its Scope 2 emissions were reduced to zero.

  • Offset

Apple reported that starting from April 2020, it has realised carbon neutrality for corporate emissions, which include not only Scope 1 and Scope 2 emissions, but also part of Scope 3 emissions, such as business travel and employee commute. In the same report, Apple reported a total of 50,540 metric tons of CO2e for Scope 1 emissions and another 520,160 metric tons for business travel and employee commute, so how could Apple claim carbon neutrality while still generating emissions from these sources?

apple greenhouse gas emissionsSource: Apple’s Environmental Progress Report 2020

The reality is that some emissions are difficult to avoid or reduce, so the last resort is to sequester or offset any remaining emissions through sequestration opportunities, Apple, for example, has been investing in projects that protect and restore forests, wetlands and grasslands that have removed enough carbon dioxide to offset the residual corporate emissions. For most organisations, it may be challenging to be directly involved in these types of projects, however, companies can still take advantage of high-quality and robust carbon credits to offset emissions.

Step 3: Extension

The last step and probably the most difficult one is to extend carbon management across its supply chain, but it is also a critical step if a corporation wishes to manage its Scope 3 emissions. To successfully cascade the strategy down to your suppliers, you need to work with your suppliers by prioritising suppliers to engage with and craft a communication plan to initiate and follow up with them, and ultimately it is about incorporating the carbon management criteria into the procurement process (Cambridge Programme for Sustainability Leadership/Business in the Community, 2009, pp. 41-44)

In Apple’s case, as 76% of its overall emissions come from product manufacturing which usually takes place in its suppliers’ facilities, Apple has been working with its suppliers through Supplier Energy Efficiency Program that aims to educate suppliers and help identify initiatives to reduce energy use and manage the implementation of the projects. Apple also supported suppliers’ reduction effort by providing funding for supplier projects, a special fund of $100 million was created for this purpose in 2019. Through Supplier Clean Energy Program, which aims to catalyse the adoption of 100% renewable electricity by its suppliers, Apple has been advocating its renewable energy policy and assisted the transition of its supplier through funding, training and other opportunities. So far, 71 manufacturing partners in 17 countries have committed to 100% renewable energy for Apple production.


National Oceanic and Atmospheric Administration (NOAA). (n.d.). Billion-Dollar Weather and Climate Disasters: Overview. Retrieved August 13, 2020, from

He, L. (2020, August 9). ‘Everything is gone.’ Flooding in China ruins farmers and risks rising food prices. CNN Business.

Green, M. (2020, January 14). Australia’s massive fires could become routine, climate scientists warn. Reuters.

Intergovernmental Panel on Climate Change (IPCC). (2014). Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change.

Science Based Targets initiative (SBTi). (n.d.). What is a science based target? Retrieved August 14, 2020, from

Labutong, N. (2018, July 13). How can companies address their scope 3 greenhouse gas emissions? CDP.

Apple commits to be 100 percent carbon neutral for its supply chain and products by 2030. (2020, July 21). Apple Newsroom.

Carbon Management & Greenhouse Gas Mitigation. (n.d.). Second Nature. Retrieved August 14, 2020, from

WBCSD/WRI. (2004). The GHG Protocol Corporate Accounting and Reporting Standard, revised edition.

Zhou, S. W.W. (2020). Carbon Management for­ a Sustainable Environment. Springer.

Cambridge Programme for Sustainability Leadership/Business in the Community. (2009). Carbon management: A practical guide for suppliers.

Environmental Progress Report. (2020). Apple.

Food and Drink Federation (FDF). (2008). Carbon Management Best Practice in Food and Drink Manufacturing.


hygiene and impact factos sustainability reporting

Beyond basics: Hygiene & impact factors in sustainability reports

The last decade saw a remarkable increase of interest in companies’ sustainability or environmental, social and governance (ESG) performance by investors, regulators, and consumers.  The charts below show the increasing demand from investors and regulators alike for companies to report on their ESG issues.

UN PRI Signatories growth

Number of signatories to the UN Principle of Responsible Investment (UN PRI).  Image from UN PRI

10 year progress on exchanges ESG requirements

Image from 10 Years of Impact and Progress, SSE (2019)


When the impacts of the pandemic first made waves through the global economy, many questioned if the momentum for sustainability will be put to a halt as societies and economies move into crisis survival mode and focus on rebuilding economies. However, with COVID-19 dubbed a “stress-test” on business resilience, ESG and sustainability practices have become evermore crucial for companies to manage their non-financial risks. BlackRock also noted that sustainable funds have been able to weather the pandemic storm and financial returns outperformed peers in the first quarter of 2020. Specifically, global sustainable mutual funds and ETFs had inflows of $40.5 billion in the first quarter, up 41% from the same year-earlier period[1].

“These inflows during a period of extraordinary market drawdown suggests a persistence in investor preferences toward sustainability,” BlackRock said. “They upend an oft-cited concern pre-Covid crisis that during sharp market downturns, investors will de-prioritize sustainability.”

Even in such extraordinary times, ESG issues and sustainability has proven yet again to be here to stay.

As sustainability / ESG reporting evolves and is now more mainstream than ever before, how can companies take this opportunity to go beyond ticking boxes, meeting regulatory requirements, and on to creating more meaningful impact?

Based on several reports and upcoming trends, we have identified disclosures that companies today should be reporting on (Hygiene Factors), and other metrics that shows a company is creating wider impact (Impact Factors).

Hygiene Factors (“must-haves”)

The International Business Council (IBC) along with the World Economic Forum (WEF) launched an initiative to “identify a core set of material ESG metrics and recommended disclosures that could be reflected in the mainstream annual reports of companies on a consistent basis across industry sectors and countries”. In January 2020, WEF prepared a report[2] proposing a set of 22 well-established, quantitative core metrics and reporting requirements. These factors were defined as “core” based on information currently popularly being reported on or information which should be easily obtainable by companies.

Core Metrics for Sustainability Reporting_Adapted from WEF

Adapted from Toward Common Metrics and Consistent Reporting of Sustainable Value Creation, WEF (2020)

The metrics and disclosures proposed here have been organized in four pillars that are aligned with the SDGs and principal ESG domains: Principles of governance, Planet, People and Prosperity. They are drawn wherever possible from existing standards and disclosures (such as the Global Reporting Initiative, Sustainability Accounting Standards Board, Task Force on Climaterelated Financial Disclosures etc.)

More details on the 22 metrics can be expected by the end of 2020.

In Singapore, the top 10 most disclosed Material ESG Factors by listed issuers also mirrors the 22 metrics proposed by the WEF[3].

Top 10 Material Issues Disclosed in Singapore

Image from Sustainability Reporting – Progress and Challenges, SGX & CGIO (2019)

Globally, these are the top material issues reported on by member companies of the World Business Council for Sustainable Development (WBCSD)[4].

Priority material issues of WBCSD companiesImage from Reporting matters, WBCSD (2019)


From the observations above, robust disclosures on issues such as good governance and ethics, climate change management (TCFD-aligned), ecosystem impacts, employee health, safety and wellbeing, and an organisations’ wider contributions to community/social development have become common practice. As investors and regulators increasingly look for comparability between companies and as quality of reports improve, basic disclosures on these “hygiene factors” will be expected of companies within their reports.

Additionally, in the COVID-era, we can also expect increased focus on social disclosures, particularly on expansion of employee workplace safety.

Impact Factors

Besides these “must-have” factors, there are other issues organisations can look at within their sustainability strategy to strengthen impact. These Impact Factors may not necessarily be separate material topics. In most cases, these are a strengthening of disclosures around similar material issues.

In the same report by the WEF, further 30 “Expanded Metrics” were proposed[5]. These metrics have “wider value chain scope or convey impact in a more sophisticated or tangible way, such as in monetary terms. They represent a more advanced way of measuring and communicating sustainable value creation, and companies are encouraged to report against them as well, when material and appropriate.”

Some notable metrics and disclosures include,

Extended Metrics for Sustainability Reporting_Adapted from WEFAdapted from Toward Common Metrics and Consistent Reporting of Sustainable Value Creation, WEF (2020)

For the full list of “Expanded metrics”, please see refer to the report.

Other key disclosures could stem from emerging trends in sustainability, particularly in the expected role of business within these trends. These include technology breakthroughs for climate mitigation, inevitable climate change adaptation, circular solutions, sustainable consumption, supply chain transparency and sustainability, biodiversity protection, and sustainable finance[6], among others.


Ultimately, what defines leadership is not reporting on a large laundry-list of material factors, but rather, in doing it well. Many reports, publications and studies[7],[8],[9],[10] have emphasised the importance of key principles and aspects of best-practice sustainability reporting. They include clearly stating the purpose of the organisation, defining material issues from stakeholder engagement and operating context, balanced reporting, strengthening alignment with global reporting and sustainability frameworks (GRI, SASB, TCFD, SBT, SDGs etc.), articulation of board responsibility, and integrating ESG risks and opportunities within the wider business model. Paia specailises in applying these principles to individual client circumstances, and working with clients to produce leading edge reports with impact.


Paia has a long track record of helping companies with their sustainability strategy and reporting. Do take a look at our areas of expertise here, or reach out to us if your organisation is looking for support on your sustainability journey.












economic recovery or climate action

Economic Recovery or Climate Action? Why Not Both?

By Adrian Pang

The raging COVID-19 pandemic that has gripped the world like a whirlwind, and social upheavals that have morphed into different beasts in different countries across the world have truly elevated the prominence of the “S” in ESG in a tumultuous 2020.

It is undeniable that these two events will fundamentally change how societies and the world organises and works. Social consciousness on public health and diversity have reached new heights. Even so, the pandemic and global economic fallout have slightly shifted primary discourses away from climate actions and environmental responsibilities – from momentum to transition to green economies and sustainable business models, to now focus on economic survival and resilience. In the short term, there are expected reductions of resources and budgets for sustainability due to economic fallout from the pandemic. But short-term economic recovery plans are insufficient to building long-term business resilience to face considerable climate risk.

Institutions need to create more socioeconomically and environmentally responsible strategies that address systemic changes required to transition to a low zero carbon global economy simultaneously with issues of human rights, racial, income and gender inequality, and overall health and wellbeing. Sustainable/Green Finance can be a substantial driver to lead a post pandemic world that values the wellbeing and survivability of the environment and society.

What is Sustainable/Green Finance

While there is not a formalised definition, green financing is generally perceived as financial flows (from banking, micro-credit, insurance, and investment) prioritising ESG risks and opportunities while still ensuring decent, if not positive rate of return. Green financing values social and environmental factors, impacts and sustainability. [1] It also brings accountability in business and financial decisions and strategies for the future. As the global economy reels from the pandemic, green financing is making significant headway into economic recovery plans. Entities in the public, private and not-for-profit sectors are encompassing this financial paradigm shift into their business continuity plans and economic resilience strategies.

Green Finance in Post-COVID 19 World

The COVID-19 crisis is seen as a rude awakening and a major stress test for the world’s social and financial systems to prepare for the long-term climate crisis. It is understandable that financial interventions and stimulus packages by countries need to address short-term health and economic weaknesses. However, governments should also strive to reshape ecosystems, investments, and production and consumption patterns through green financing to realise a resilient, and sustainable recovery as well as future. [2] The Financial Times argues that cost of climate inaction would amount to a staggering $600 trillion by 2100. This is inevitable at the current trajectory, as the world will not see its carbon emissions halved by 2030 as set out by the Paris Agreement. 2030 is also the expected year of climate tipping point – the point of no return for the climate crisis. Therefore, drastic measures like Green Finance are required now to make systemic changes in the post pandemic world.

The World Bank has recently published a guide for financial regulators in emerging economies to scale up green finance in their countries. [3] The guide can help financial institutions to structure and refine green finance products (e.g. loans, credits, and guarantees) as well as encourage investors to invest in impact investments opportunities that comply with sustainability criterions. The European Union is pushing for a Green Deal for economic recoveries post pandemic. The regional bloc has set up a new “Green Recovery Alliance” that brings together politicians, CEOs, NGOs, think tanks and subject matter experts across the continent to identify and drive green finance and investments. Elsewhere, the slogan “Build Back Better” is increasingly a catchphrase for many governments to tailor their economic recovery strategies to incorporate low-carbon and clean economic developments. Hong Kong and China have implemented mandatory ESG disclosure for companies while French bank Natixis voluntarily incorporated climate risk into its credit decision-making process. [4] South Korea has also pledged to a “Green New Deal” as it recovers from the COVID-19 induced economic losses. [5] Overall, there are encouraging signs that countries are embarking on the green path to economic recoveries.

Moving Forward and Organisations’ Roles

The conundrum between prioritising economic recovery or climate action remains needlessly real. Indeed, countries in Asia, of which many are emerging economies remain reliant on restoring traditional economic and financial fundamentals (which are often carbon intensive) to reboot their economies. [6] This is counterproductive to global progress made on the sustainability front.

2020 is on course to record the largest drop of GHG emissions, estimated at 8% year on year. [7] However, this reduction is due to enforced lockdowns and decreased traffic volumes globally and it is likely to be an one-off anomaly post-pandemic. The world needs to achieve at least 7.6% reduction annually between 2020 to 2030 to keep global temperature increase to less than 1.5 degree Celsius by the end of the century.

The bottom line remains, we need to protect the Earth now more than ever. The pandemic is a good reset for how things work. In fact, the world is ready for a paradigm shift on green finance where climate and sustainability elements can closely entwine with economic recovery and development.

Companies and organisations also have significant roles and responsibilities in realising more sustainable development and popularising green finance post COVID-19. Some possible actions are: working with governments to stimulate green recoveries, supercharging corporate resilience and prioritising climate risks, bailouts or financial tools with sustainability strings attached, enhancing ESG performance and disclosure, altering business models and practices, and identifying sustainable values in business deals and developments.[8] All these potential strategies can involve and abide by values of green financing. We have seen a strong push for the big “S” in 2020, let us also push for the big “E” and “G”.

Reach out to us to find more about how you can enhance your sustainability/ESG strategies and performances as well as how green financing could work for your organisation or business.










Gender responsible procurement

By Sanjala Hari

Recently, global movements on non-discrimination, human rights and equality have brought a strong focus on how companies are looking at inclusivity and equality in their workplace. Apart from racial and ethnical diversity, removing any biasness against gender in the workplace has also contributed to having in inclusive team. A few companies are now looking beyond empowering women in their own workforce to also include such considerations during their procurement processes. Gender responsive procurement is now gaining traction, and many see the benefit in enabling purchase of gender-sensitive goods and services and supporting women-owned businesses.


A few companies are now looking beyond empowering women in their own workforce to also include such considerations during their procurement processes.

The UN Women define gender responsive procurement as ‘the sustainable selection of goods, civil works or services that takes into account their impact on gender equality and women’s empowerment’. By enabling gender responsive procurement, companies support the elimination of discrimination against women by treating male and female suppliers on equal terms. Gender responsible procurement aligns with Sustainable Development Goal (SDG) 5, although there are specific targets related to women and girls in SDG 12 of the SDG 17 goals. Gender-responsive procurement also aligns with one of the seven drivers identified by the UN High-Level Panel on Women’s Economic Empowerment.


Gender responsive procurement practices have had a positive impact on profitability and return on investment.

Women owned businesses today contribute significantly to the global economy. According to Global Entrepreneurship Research Association report in 2014, there were approximately 224 million women entrepreneurs worldwide. Women were also involved in over 80 percent of purchasing decisions worldwide (Dalberg, 2014). According to World Bank, in 2012, 35% of all small and medium enterprises (SMEs) are owned by women. Supporting women entrepreneurs has its own benefits. A study by McKinsey in 2015 confirms that gender-responsive procurement practices have had a positive impact on profitability and return on investment. The report also indicated that if women played an identical role in labour markets to that of men, as much as USD 28 trillion, or 26 percent, could be added to the global annual Gross Domestic Product by 2025.


Despite the various benefits of supporting women entrepreneurs, women owned businesses lag behind businesses owned by men due to various socio-cultural challenges, and/or economic and legal inequalities. Social and cultural expectations and unequal distribution of responsibilities persists for women even after they enter the workforce or start a business. Women also face challenges in access to financial capital, social and human capital. Women face challenges in acquiring collateral to start a business as they might have less access to financing than men in certain geographies. Similarly, some research shows that women find difficulty in establishing business networks and connections. Due to unequal preference to education among genders in certain geographies, women often lack the managerial experience to start a business.


The foundation of public procurement is on the principles of equality, non-discrimination and transparency. Public procurement has a large potential to promote gender responsible procurement. Companies can allow inclusion of gender criteria during assessment of proposals submitted. Companies can evaluate the proposals submitted based on criteria such as whether the project team is gender-balanced, and balanced presence of women and men in decision-making positions.

Companies can expand their network and business relationships to target businesses that are primarily women-owned

Companies can expand their network and business relationships to target businesses that are primarily women-owned – which could include small and medium size businesses run by women entrepreneurs. This would also include companies to fit technical, financial and other prequalification and qualification requirements based on the size and complexity of the opportunities, such that women-owned SMEs are not blindly eliminated during the procurement process. For unsuccessful bidders, providing a useful feedback on their strengths and weaknesses can help provide opportunities for improvement, especially for women owned businesses.

For businesses looking to diversify their overall supply chain and possibly reduce their spending on suppliers, procuring from women owned business could be the answer. Similarly, incorporating gender sensitive requirements during procurement process and engagements can not only support your company’s commitment towards gender equality, but also help companies mitigate any risks on gender discrimination or abuses in supplier operations.

Reach out to us to find out more about how you can include gender considerations in your procurement processes. More on our supply chain services .


GRI Standards 2020 update: Waste

In this article:

  • Introduction
  • Waste-related impacts
  • Circularity Measures
  • Reporting on quantitative data using revised Waste Standards
  • Circularity tools


The Global Sustainability Standards Board (GSSB), GRI’s independent standard-setting body, released a revised Waste standard in May 2020. It is effective for reports published on or after 1 Jan 2022, although earlier adoption is encouraged.

The revision of GRI Standards is done on an ongoing basis to reflect the most recent trends and developments of environmental and social issues in the Standards. In 2018, GSSB revised the standards for Water and Effluents and Occupational Health and Safety. In 2019, a new standard for Tax transparency was released.

In particular, the revised waste standard replaces the older version which was based on an older paradigm in which waste was assumed to have no economic value. The revised standard also encourages disclosure relating to circularity. Organisation are now required to report, among others:

  • significant actual and potential waste-related impacts (GRI 306-1),
  • actions, including circularity measures, taken to prevent waste generation in the organisation’s own activities and upstream and downstream in its value chain, and to manage significant impacts from waste generated (GRI 306-2)

In this article, we discuss two key terms used in the standard in more detail: “waste-related impacts” and “circularity measures”. For more experienced GRI users, we have also summed up the changes in quantitative information required in the revised Standard.


Waste-related Impacts

Waste-related ‘impact’ refers to the effect of the waste generated by an organisation on the economy, the environment, and/or society.

Typically, organisations consider their waste generated in their operations and sometimes in their supply chain. In life cycle thinking, organisations also take into account the end-of-life of their products and services, and as a result their (waste) responsibility and impact do not end at the point of sale, but the point in time when the customer no longer finds value in the product. They would think about the amount of waste they pass on to their customers.

Waste-related impacts on people and the environment would depend on how the waste is transported, where it ends up and how it is treated (or not). GRI for instance gave the example of threat of marine pollution resulting from leakage of discarded plastic packaging into waterbodies. In Singapore, for example, many organisations do not know what happens to their waste or recyclables after they are being collected by third-party waste collectors, and therefore have little visibility on their waste impact at the disposal stage. GRI now requires organisations that engage a third party to manage its waste to describe “the processes used to determine whether the third party manages the waste in line with contractual or legislative obligations”.

To start understanding your waste-related impacts, you could start collecting data on the amount of materials used and waste generated in your value chain, as well as the properties of these inputs and outputs that limit or enable their recovery (e.g. reuse, recycle) or durability.


Circularity measures

To understand the concept of circularity, first consider a typical production process: raw materials are taken from the environment, produced into goods and services, used by consumers, before it is thrown away as waste. In this linear model, the value of the materials becomes lost at the end of its use. In a circular model, on the other hand, the value of the materials gets retained as long as possible, through measures such as reusing, remaking or recycling. These circularity measures are better for the environment because by keeping materials in use as long as possible, they prevent waste accumulation and resource depletion.


Source: Paia Consulting, adapted from Catherine Weetman (2016)


Tracking material flow(s) forces an organisation to examine its value chain – activities that convert input into output by adding value. Typically this gives better clarity on the life cycle of your products and services, including your inputs and suppliers upstream, and your outputs and customers downstream. Such life cycle thinking not only helps organisations identify causes of waste generation but is also an opportunity to improve process efficiencies and rethink business models.


Reporting on quantitative data using revised Waste Standards

For experienced GRI users, here are the key changes:


1. Effluents are no longer reported under “waste”
For organisations reporting on water discharge or effluents (2016 GRI 306-1 or 306-5), to report them under the 2018 GRI 303: Water instead of the 2016 GRI 306: Waste and Effluents.

For organisations reporting on spills, to continue reporting under the 2016 standard, but to look out for the upcoming Spills and Leaks standard that will be developed in the next few years. The indicator (2016 GRI 306-3) will be withdrawn on 1 Jan 2022.


2. Waste data is to be broken down into generation (306-3), diverted from disposal (306-4) and directed to disposal (306-5), reflecting the waste management hierarchy
GRI introduces the waste management hierarchy in this standard. Waste prevention, or waste reduction, is the most preferable option in the hierarchy, as it prevents the resulting impacts on the environment and human health. It is then followed by followed by recovery operations that divert waste from being sent to landfill or incineration, such as preparation for reuse, recycling. Disposal is the least preferable option in the waste management hierarchy as it is associated with the most negative impacts on the environment.


Source: EPA

Under each waste management option, the revised standard has a few broad categories for disposal methods:

  • Diverted from disposal, by recovery operations such as:
    • Preparation for reuse
    • Recycling (includes downcycling, upcycling, composting, or anaerobic digestion)
  • Directed to disposal, by operations such as:
    • Incineration (with energy recovery)
    • Incineration (without energy recovery)
    • Landfilling

To note, the definition of recovery is slightly different from that of the previous standard.

There is also requirement for additional disclosure of whether the waste is diverted on-site of off-site, to show the extent to which the organisation knows how its waste is managed.


3. Transportation of hazardous waste is no longer a standalone metric

In the revised Standards, transportation is to be disclosed under “waste management by third parties” (GRI306-2).


Circularity tools

For companies interested in waste reduction and circularity, here are some tools that may be helpful:


Circulytics by Ellen MacArthur Foundation

This company-level measuring tool reveals the extent to which a company has achieved circularity across its entire operations. It does this by using the widest set of indicators currently available: enablers and outcomes.


Circular Transition Indicators (CTI) by World Business Council for Sustainable Development

A framework to measure circularity, the Circular Transition Indicators (CTI) is a simple, objective and quantitative framework that can be applied to businesses of all industries, sizes, value chain positions and geographies.


Paia Consulting can support you in your waste reporting and management strategy.


We have extensive experience working with NEA and Singapore companies on their sustainability, waste and recycling. Our waste services include data measurement and reporting, conducting waste audits, and creating waste reduction plans. If you are interested in further discussion of this topic, contact us at



A Bright Solar PV Prospect for Singapore

By Adrian Pang

The Sustainable Energy Association of Singapore (SEAS) hosted a recent webinar on the solar photovoltaic (PV) roadmap of Singapore. Dr. Thomas Reindle, CEO of the Solar Energy Research Institute of Singapore (SERIS) at the National University of Singapore (NUS) presented a holistic summary of SERIS’s report that charts Singapore’s roadmap based on reviews and updates of its 2014 roadmap. The roadmap highlights Singapore’s great potential in expanding its solar PV infrastructure and services. Some of the key areas of development are:

    • Existing topics: space availability, space utilisation, increasing energy yield, levelised cost of electricity from solar PV (LCOE), possible scenarios for PV deployment, managing PV grid integration,
    • New topics: end-of-life PV recycling, repowering, Renewable Energy Certificates (RECs), and importing of solar energy.
  1. Space availability: Solar PV deployment is part of sustainable urban planning and it embodies the clean and green ‘Garden City’ vision that Singapore values. Solar PVs benefit the environment and have public acceptance as it is perceived to be safe. Space availability for different types of PV deployment is assessed based on these values and their respective potentials. Despite being a small island nation, Singapore can deploy five types of solar PV:
    • Rooftop (most common in Singapore)
    • Facades (for building-added and building-integrated PV, BAPV/BIPV[1]
    • Mobile-/land-based PV (temporary land use)
    • Floating PV (reservoirs, near-shore), and
    • Infrastructure PV (e.g. over-arching land, canals, roads, or PV noise barriers).
  1. Space Utilisation: Solar PV deployment in land-scarce Singapore also entails the highest utilisation and efficiency of technologies employed. While ultra-high efficient modules have similar levelised cost of electricity (LCOE) as most standard modules, they have higher area efficiency, hence higher space utilisation. Put simply, more electricity generation in a given surface area. At present, ultra-high-efficiency technologies have higher market prices due to limited availability but higher production and demand will drive process and cost down for the benefit of Singapore’s solar landscape in the future. Aside from technologies, increasing area factor of PV systems and implementing novel PV applications (e.g. co-location of rooftop PV with greenery, improving BIPV areas, expanding floating PV, etc.) can maximise space utilisation of PV systems in Singapore too.
  1. Increasing energy yield: Solar technologies are also important to maximise PV system’s energy yield from its installed capacity. A well-designed system in Singapore has an initial “Performance Ratio” (PR) value of above 80% with a typical degradation rates of 0.8% per annum. The degradation is caused largely by Singapore’s high temperature climate conditions. Therefore, a PV system with good ventilation or technologies to regulate temperature (e.g. Floating PV) is beneficial in increasing energy yield. The “Floating PV testbed” at Tengeh Reservoir is found to have 5% to 15% higher energy yield. Next, the highly distributed nature of small individual systems in Singapore requires smart operation and maintenance, and fleet management to maintain effective energy yield and performance consistently. Approaches such as predictive and preventive maintenance based on big data, Artificial Intelligence, comprehensive diagnostics of issues, etc. are important to maintain a lean but efficient operation and maintenance of Singapore’s sprawling solar PV systems.
  1. Planning, management and development: Apart from physical infrastructure development, good strategic planning and actions are required to upscale solar PV systems in Singapore.
    • Minimising the levelised cost of electricity from solar PV (LCOE): LCOE is a well-established method in energy finance and policy that calculates the generation cost at the point of connection to a load or power grid. In an energy market, sources that have lower LCOE are preferred and prioritised. Therefore, solar energy should strive to achieve lower LCOE through the continuous research and development.
    • Possible scenarios for PV deployment: a scenario-based approach charts the potential development trajectories of solar PV deployments. In Singapore, there are two scenarios that are associated with different levels of adoption and technological advancements – “Baseline” (BAS) and “Accelerated” (ACC).
    • Managing PV grid integration: As renewable energies are highly varied in nature, solar PV faces challenges from other renewable sources to be the preferred renewable energy source in Singapore. An all-encompassing and comprehensive approach that includes assessing global development trends in the renewables sphere, PV grid integration measures (supply and demand side management, energy storage system (ESS), grid upgradation, and new equipment), and grid impact assessment of PV (demand profile and ramp rate impact, distribution network impact, inertia and reserve requirements, and protection system) are required to solidify solar PV’s status as Singapore’s preferred renewable energy source.

Aside from the existing topics that require constant improvements, the updated project also identified new topics that are crucial for the development of solar PV deployment in Singapore.

  1. Re-powering: As PV systems age, power generation equipments require replacement with the latest technologies that have higher efficiencies, better performance and greater reliability. This is evident in the more mature wind industry where maximum power generation per tower and size of windmills have increased substantially. As the development of wind power project sites are usually time consuming, it is often more economical to upgrade existing systems.
  1. Recycling: As the solar industry grows exponentially, ageing PV modules are an upcoming waste issue that requires responsible management. A study by the International Renewable Energy Agency (IRENA) showed that PV waste was around 250 tonnes in 2016 and is expected to grow to 1.7-8 million tonnes by 2030. Ageing modules constitute hazardous waste if not managed properly. Therefore, recycling is crucial in the PV value chain. There is currently no PV recycling company in Singapore, as well as a lack of efficient and cost-effective PV management process locally due to the low volume of PV waste and a relatively young market. However, Singapore is projected to increase its solar capacity from the current 350 MWp to 2GWp by 2030. Coupled with the “re-powering” of old assets that accelerate the decommissioning of certain existing installations, “end-of-life” PV and system components require the formation of policy-based regulations and technological improvements to ensure safe and sustainable recycling.
  1. Renewable Energy Certificates (RECs): RECs are tradeable, non-tangible market instruments that represent proof that electricity was generated from a renewable energy (RE) source. There are two categories of RECs:
    • Bundled RECs: instruments whereby the “green attribute” is coupled with the electricity that is generated. Bundle RECs are generated and retired in tandem with the actual supply and consumption of electricity, thereby bound by certain considerations such as geographic constraints.
    • Unbundled RECs: instruments whereby the “green attribute” is decoupled from the electricity that is generated. Unbundled RECs do not provide physical delivery of electricity from a renewable source but rather its green attribute. Unbundled RECs allow for more flexibility as business can purchase them at different volumes and at any time based on internal business and sustainability goals and decisions.
  1. Importing of Solar Energy: Singapore can boost its share of renewable energy by importing from other countries in the forms of electricity or other energy carriers such as hydrogen (often referred as “solar fuels”). However, the premise of importing renewable energies also includes other renewable sources such as wind power, bioenergy, hydropower or geothermal. At present, these are the notable projects and developments:
    • Trans-border cable connections
      • PV system deployment in neighbouring countries (e.g. setting up Solar Farms in Malaysia and transporting energy generated across the Johor Strait)
      • Pan-Asian power grid interconnection (transnational super grids that foster large scale utilisation of renewable energy sources beyond regional co-operation)
    • Imports over greater distances
      • Off-shore floating solar farms (e.g. Singapore building off-shore solar farms in international waters of the South China Sea, supplying solar electricity via subsea cables to Singapore)
      • Long-distance cable connections
    • Importing solar fuels (e.g. Australia’s national hydrogen strategy focuses on developing and expanding its hydrogen export markets)

The webinar on the updated solar photovoltaic (PV) roadmap of Singapore concluded with the following priorities to increase solar power use in Singapore. First, there is a need for high to ultra-high efficiency solar technologies. Secondly, employing novel “urban solar” applications (cost-effective solutions with good deployment and no substantial substitutes type of potential developments). As for topics with increasing relevance for the solar PV sphere in Singapore, discussions around recycling and circular economy, urban heat island effect of PV in cities and bankability of PV in Singapore are gathering pace. Overall, Singapore possesses a high potential to make significant transitional steps to become a solar powered country.


TCFD Demystified

By Junying Lou

Background and Development

The Task Force on Climate-related Financial Disclosures (TCFD) was established in 2015, following the milestone speech by Mark Carney [1], Governor of the Bank of England and Chair of the Financial Stability Board. During the speech, he explained the grave threat posed by unpriced climate-related risks to global financial stability.

The final report [2] published by the Task Force in June 2017 includes 11 recommended disclosures around 4 core elements: governance, strategy, risk management, and metrics and targets. The disclosures aim to help the target audience, primarily investors, lenders, and insurers, to understand how the reporting organisation assesses and manages climate-related risks and opportunities, to form the basis of informed investment decisions.

Core Elements of Recommended Climate-related Financial Disclosures

Source: TCFD

Since the publication of the final report, TCFD is gaining momentum. As of February 2020, TCFD has over 1,027 supporters, representing a market capitalisation of over $12 trillion [3]. Many policymakers are considering integrating TCFD recommendations into national reporting frameworks. For example, the European Commission issued non-binding reporting guidelines on climate-related information in June 2019 [4], the Australian Securities and Investments Commission updated guidance on climate change-related disclosure in August 2019 to incorporate the climate change risks developed by TCFD into the list of common risks examples that may be relevant to prospectus disclosure and highlight climate change as a systemic risk for the reporting entity [5]. Hong Kong Exchange (HKEX) recently introduced a new climate change disclosure Aspect A4 on a “comply or explain” basis which will apply to financial years commencing on or after 1 July 2020. The issuers will need to disclose their policies on measures to identify and mitigate significant climate-related issues that have impacted or may impact the issuer, and a description of the significant climate-related issues and corresponding mitigation measures [6]. In March 2020, The UK Financial Conduct Authority (FCA) released a consultation paper to propose that all commercial companies with a premium listing on the London Stock Exchange comply with disclosure recommendations issued by TCFD. According to FCA, they intend to publish a policy statement later in 2020 with finalised rule and technical note after the conclusion of the consultation [7].

Managing climate-related risks and opportunities is not only an environmental challenge, but a business one.

When talking about climate-related risks, the first thing that may come to mind is natural disasters, such as hurricanes and heatwaves. TCFD made it clear that climate-related risks encompass a wider range of risks. Aside from physical impacts of climate change (physical risk), organisations also need to prepare for risks related to the transition to a lower-carbon economy (transition risk):


These climate-related risks, if managed skillfully, could be turned into opportunities. Forward-thinking organisations can take this opportunity to transform the business into a lean operation by improving resource efficiency and capitalising on new markets and demands of low-carbon products.

Both climate-related risks and opportunities, as recommended by TCFD, need to be carefully considered and incorporated into financial reporting in the following areas: operating cost and revenue, capital expenditures and capital allocation, acquisitions or divestments, and access to capital.

Scenario analysis: constructing alternative futures to test the resilience of the organisation’s business strategy

Among the recommended disclosures proposed by the Task Force, the scenario analysis is the most unique feature that sets TCFD apart from other reporting frameworks. It is also the disclosure item most companies find challenging.

The world is at a crossroads. We can be looking at very different futures depending on the speed and effectiveness of our greenhouse gas emission reduction effort. For most organisations, their current business strategies are built on the assumption that the future will look similar to today, but with the changing climate, this assumption may not hold anymore. The scenario analysis thus provides an opportunity for decision-makers to peer into the alternative futures and reflect on the resilience of their business strategies in the face of newly identified climate-related risks and opportunities.

TCFD discusses in details the use of scenario analysis to help organisations navigate climate-related risks and opportunities over medium to longer-term in its published technical supplement [8] Organisations are advised to start with an understanding of climate science and global scenarios developed by international organisations like international Intergovernmental Panel on Climate Change (IPCC) and International Energy Agency (IEA). Global scenarios can be used to provide a broad context and macro trends for organisations, but organisations need to take matters into their own hands by thinking through how the macro trend, both physical changes in climate and the regulatory, behavioural and technological changes, can potentially impact their direct operations and other players in their value chain to assess the full range of physical and transition risks they are facing.

Even though it is identified that some industries are more vulnerable [9] than others to climate change, all industries will inevitably have to address climate-related risks and opportunities in one way or another. And as highlighted by TCFD, the implementation of its recommendations will be a journey, and companies should start early to continually improve the quality and usefulness of the climate-related disclosures and to fully integrate climate-related issues into their risk management and strategic planning processes. For these reasons, organisations are advised to take early actions to identify and manage the climate-related risks and opportunities to future proof their businesses.

TCFD strategy and implementation is one of Paia’s key expertise and services. Do speak to us if your organisation would like to learn more about how to implement TCFD. You can reach us at

[1] Breaking the tragedy of the horizon – climate change and financial stability – speech by Mark Carney

[2] TCFD: Final Report: Recommendations of the Task Force on Climate-related Financial Disclosures (June 2017)

[3] TCFD: TCFD Supporters

[4] European Commission: Guidelines on reporting climate-related information

[5] Australian Securities and Investments Commission: 19-208MR ASIC updates guidance on climate change related disclosure

[6] HKEX: Consultation Conclusions: Review of the environmental, social and governance reporting guide and related listing rules

[7] FCA: Proposals to enhance climate-related disclosures by listed issuers and clarification of existing disclosure obligations

[8] TCFD: Technical Supplement: The Use of Scenario Analysis in Disclosure of Climate-related Risks and Opportunities (June 2017)

[9] CNBC: 7 industries at greatest risk from climate change

AirCarbon – A New Carbon Trading Frontier

AirCarbon – A New Carbon Trading Frontier

By Ho Ning Li and Adrian Pang

Paia Consulting’s partner, AirCarbon Exchange (AirCarbon) hosted their inaugural International Chamber of Commerce (ICC) – AirCarbon trading day on 10th June 2020, a virtual carbon trading simulation amidst the budding sphere of carbon trading.

Incorporated in Singapore in late 2019, AirCarbon is the world’s first digital exchange platform for airlines to trade carbon credits. Their launch is timely, with the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) initial programs approved by International Civil Aviation Organization (ICAO) in March 2020. Even with global air travel down due to COVID-19, CORSIA timelines are expected remain in place, with climate action a key focus as economies recover from the pandemic.

Carbon: an asset class for responsible investment

Carbon has been traded in several regions and countries for a decade or so, such as European Union, Japan, South Korea and China, each with their own mechanisms and regulations. With ICAO’s approval of CORSIA programs, we expect a more global, industry-wide and hopefully more mainstream trading of carbon.

Carbon (or emissions) trading is premised on the cap-and-trade concept, where only a certain amount of carbon dioxide emissions is allowed for the region or industry in order to limit global temperature increase. Carbon trading is therefore one of the policy tools that is used by economies to mitigate climate change.

Singapore, as a regional and global hub for tourism, trade and finance, is primed to propel carbon trading as a new form of commodity trading that also carries environmental significance through carbon emissions reductions.

Read more about AirCarbon’s carbon trading mechanism below or speak to us if you are interested to incorporate carbon trading in your sustainability strategy.

Trading carbon using the AirCarbon platform

AirCarbon provides a platform that uses conventional commodities trading infrastructure and architecture while leveraging more recent and popular blockchain technology to create securitized carbon credit on Ethereum (second largest cryptocurrency platform by market capitalization). Moreover, AirCarbon seeks to securitize carbon credits around market demand that allows traders to gain exposure to an asset class as opposed to the conventional carbon market’s organisation around individual projects (see UN’s Clean Development Mechanism). AirCarbon also designed their platform to be in the same nature as other financial market platforms and maintains their independence from carbon market participants by operating solely as a trading platform.

AirCarbon seeks to streamline carbon trading based on market demands by securitizing carbon credits into three tradable carbon asset classes. Each credit class is organised and regulated around the market they serve. Traders who deposit carbon credits into a Trust managed by the platform will acquire a one-ton Token of any of the three carbon asset classes they prefer in return. The rate of each Token is subject to an Exchange like any other traditional asset trading. The platform’s Token is currently the easiest and most streamlined instrument for carbon credits trading.

AirCarbon’s three carbon assets are as follows:

  1. AirCarbon CORSIA Token (ACCT): Every ACCT is backed by a corresponding carbon credit eligible under International Civil Aviation Association’s (ICAO) Carbon Reduction Offset & Reductions Scheme for International Aviation (“CORSIA”).
  2. AirCarbon Nature Token (ACNT): Every ACNT is supported by a corresponding carbon credit registered under Verified Carbon Standard (VCS) covering activities in wetlands, grasslands, forestry and agriculture
  3. AirCarbon Premium Token (ACPT): All carbon credits supporting the ACPT satisfy stringent additional criteria and at least 4 UN Sustainable Development Goals.

Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) 

ICAO Approves Initial Carbon Offset Programs for CORSIA

Carbon trading: How does it work?


The Link between Corruption and Human Rights

By Sanjala Hari

Human rights, particularly in the recent times, has been a key topic within the ESG space. With this, there is also growing traction of the role that corruption plays in impeding human rights. Corruption hinders effective discharge of human rights obligations diverting resources needed for safe and humane working conditions and preventing the right to fair trial. According to a study, countries with high rates of corruption are the ones with a poor human rights record (Transparency International’s Corruption Perceptions Index, 2017).

If we look at the conventional sustainability venn-diagram, it consists of Environmental, Social and Governance components. The three components overlap and influence the way businesses perform. Such is the overlap between corruption – a governance topic, and human rights – a social topic. Corruption is prevalent in businesses where there is unjust balance of powers, or where there is lack of transparency of information flow and decisions. Corruption through bribery or extortion often leads to oppressing the rights of the lesser-privileged workforce.

Due to complex global supply chains, businesses often operate in regions of the world where corruption is prevalent. Transparency has been one of the biggest challenges in global supply chains in eradicating corruption and in-turn human rights abuses. Transparency issues occur due to poor information sharing. In most cases, governance management of businesses work in silo of the social and environmental management. To facilitate good governance and prevent social abuses among supply chain players, buying companies must aim for procurement reforms that include strict provisions on all three – environmental, social and governance topics, in their contract decisions and supplier assessments. This would mean including all departments involved with environmental, social and governance management within a business and procurement practice to bring out effective reforms.

Human rights violations caused by corruption activities does not affect all workforce equally. Marginalised and discriminated groups are often the ones most affected. These include the poorer sections of the society, indigenous people, and women. Community consultation is key to prevent human rights violations. Contracts behind closed doors that do not take community consultations into considerations are often considered human rights violations. Businesses need to strengthen their due diligence work and whistle-blowing mechanisms to not only prevent corruption, such as bribery and extortion, but also prevent the human rights abuses that follow.


The Future of Sustainability Reporting for the Healthcare Sector

By Cheryl Lee

The COVID-19 pandemic has thrust healthcare systems and the healthcare industry into the global spotlight in recent months, as governments raced to conduct mass testing and secure isolation facilities, while healthcare systems creaked under the strain of a dramatically increased patient load, exacerbated by the shortage of healthcare workers and equipment.

If there is one thing the pandemic has taught us, it is that healthcare systems must be resilient, especially in times of crisis. As summarised by the World Health Organisation (WHO), “For health systems to be resilient, they require quality health services that are delivered prior to, maintained during, and improved upon following an emergency.”[1] WHO places the promotion of health and well-being, which includes creating resilient healthcare systems, at the centre of the 2030 agenda of the United Nations’ (UN) Sustainable Development Goals (SDGs).[2]

Health and well-being have clear links to each of the 17 SDGs:

Source: WHO, 2016

Public and private healthcare organisations play essential roles in building a resilient healthcare system. To effectively play their roles, healthcare organisations need to be clear on their corporate purpose, mission and strategy, and communicate these well to align internal and external stakeholders, who can then better support the organisation in the delivery of its mission and strategy. For publicly listed companies, this communication tends to take the form of an annual sustainability report, where the organisation discloses its strategy and activities undertaken that have created value (financial and non-financial) for stakeholders and wider society. While most organisations publish sustainability reports, many often fail to adequately reflect the company’s mission and strategy in the topics they report on. COVID-19 has heightened growing stakeholder and societal expectations that companies should be responsible corporate citizens; it is no longer simply beneficial but imperative that organisations re-examine their mission, strategy, and communications, taking into account all stakeholders’ interests. We looked at the sustainability reports of publicly listed healthcare companies in the region and identified key areas for improvement in their sustainability strategy and reporting:

Report on environmental topics like waste, water, biodiversity, energy and emissions. Climate change, coupled with the ease of travel, means that we can expect greater transmission of infectious diseases and more frequent pandemics. Clean environments reduce the incidence of pollution-related diseases that are highly preventable. It is time that healthcare organisations recognise the importance of environmental management and climate change adaptation and mitigation, and start addressing their impacts on the environment in reporting.

Ensure accessibility to healthcare. As headlines put it, “COVID-19 doesn’t discriminate.” The widespread and rapid growth of the pandemic shows that accessibility of healthcare is crucial, not just for the individual but for the greater good of communities, cities and countries. Healthcare companies have a responsibility to promote equitable access to basic healthcare and medicines, enabling sustainable development to be achieved for all.

Invest in innovation and technology. Innovation and technology are important drivers of change. Embracing technology is also one way healthcare systems can compensate for a shortage in healthcare workers, especially since this shortage is set to worsen in the coming years in developed countries due to ageing populations. COVID-19 has forced many healthcare organisations to explore new methods of providing healthcare – such as via teleconsultations and mobile apps. Even after the pandemic, many of these new innovation and technology-enabled changes will likely to be here to stay, and prove a transformative force for the industry in years to come.

“Health is an end-point that reflects the success of multiple other goals.” Dr Margaret Chan, WHO Director General [3]

Enhance alignment with the SDGs. As evidenced by the WHO, health promotion plays a major role in advancing the global agenda of sustainable development. Healthcare organisations should look to align their efforts beyond just Goal 3: Good Health and Wellbeing, because the achievement of all of the other 16 goals are contingent on global health. For example, prioritising health needs of the poor can help them break out of the poverty cycle (SDG 1); advocating for sexual and reproductive health literacy can empower women and girls (SDG 5); ensuring accessibility of health services and particularly primary care can help reduce inequality (SDG 10), and promoting low-carbon development creates cleaner and healthier environments (SDG 13).

Foster strong partnerships. With government healthcare spending continuing to rise globally[4], support from the private sector and voluntary welfare organisations is essential to create sustainable systems that meet the populations’ healthcare needs. SDG 17, Partnerships for the Goals, emphasises the need for public-private partnerships both within sectors and across sectors. Strong collaboration, knowledge-sharing and dissemination of best practices across different partners will help build resilient and sustainable healthcare systems.

Health is a fundamental right that cannot be achieved in isolation from sustainability. At the core, they share the same mission to improve human well-being, both now and in the future. By incorporating sustainability into their corporate mission and strategy, healthcare organisations stand to reap the benefits of the natural synergy between healthcare and sustainability while helping to build resilient healthcare systems, future-proofing their business and creating long-term value for all.

[1] WHO,

[2] WHO 9th Global Conference on Health Promotion, 2016

[3] WHO 9th Global Conference on Health Promotion, 2016

[4] WHO Global Spending on Health: A World in Transition Report, 2019

Time for Nature

Today, 5 June, marks World Environment Day. This year, the United Nations Environment Programme themed the occasion “Time for Nature”, celebrating biodiversity on this planet. Many recent events such as the recent bushfires in Australia to the current pandemic and demonstrated our immense interdependence with nature. To celebrate this occasion, the team here at Paia has put together some of our fondest or most poignant memories with nature – from the magnificent to the everyday. We hope that these stories will be able to create some light in current times of immense uncertainty. Enjoy!

Himachal Pradesh

It was the summer of 2013 and I was doing my internship in Delhi, India. As part of the one-month programme, our group of about 30 visited various villages and towns in the state of Himachal Pradesh. Himachal Pradesh is a northern Indian state at the foothills of the Himalayas. My best memory of this trip is camping at the foothills of the Himalayas, in a place called Sangla, in the district of Kinnaur. We camped amidst tall, misty pine trees, beside a brook flowing down from the snowy mountains. We were surrounded by greenery and engulfed by nature on all four sides. Looking up at the pine trees and snow-capped mountains, I remember never having experienced a beauty like that before… and I have never experienced a beauty like that since. It dawned on me then how gorgeous, yet powerful nature is. Our group winded down the evening snuggling around a bon fire we made to keep us warm. It was the start of the most adventurous experience of my life. (Photo Credits: Aristo Mendis) -Sanjala Hari

South Africa

One of my best memories in nature was when I visited a wildlife reserve in South Africa last year. We would start each day with a game drive at sunrise, and end the day with another drive over sunset. The sunrises and sunsets were the most beautiful I’d ever seen in my life. I felt my soul expanding, pulsating with joy, filled with wonder and amazement. I saw the Big Five – elephants, leopards, lions, rhinos and buffalos – in exhilarating and breath-taking proximity. One night we sat in absolute darkness and silence as a lion feasted on the carcass of a poor giraffe – the sound of teeth scraping against bone and his roars to summon his pride sent shivers down our spines. At that moment, we were acutely aware of how vulnerable and defenceless we were next to these majestic creatures. While I appreciated nature, I had never been much of an outdoor person (with an immense dislike of bugs, leeches, ticks and mosquitoes). This experience changed me profoundly. I think I am much more of an outdoorsy person now. -Cheryl Lee

Finding nature in the city

Juvenile horseshoe crab at Kranji Mudflats, 2017 (Hand for scale)

I appreciate that pockets of nature are still present and conserved in urbanised Singapore. Colugos in our lovely MacRitchie nature reserves, diverse coral communities in our offshore islands, the majestic Pulai tree in Chek Jawa. Even short moments of contact with our animal friends always bring a smile to my face, such as a jungle fowl crossing the roads of Tanjong Pagar, or a sunbird singing by the window. I haven’t caught our resident otters in action – it’s on my wishlist. I take this time to be grateful for nature – it is a source of inspiration and joy for me. -Ning Li

Sierra Leone

I conducted a field research trip in Freetown, the capital of Sierra Leone in 2019. It was there that I witnessed first-hand just how thin and fine the balance of nature is. The country experienced a tragic civil war just decades prior. As a result, mass migrations from the rural provinces into the city occurred for safety and economic reasons. The city’s population expanded from around 400,000 to 1,000,000 people, which caused infrastructures and public services to struggle to cope with the population influx ever since. With the lack of proper housings, migrants build houses themselves wherever they found lands without proper access to utilities and essential services. Eventually, neighbourhoods became sprawling informal settlements or slums that extended to formerly untouched nature. The unregulated expansion of these informal settlements often resulted in the complete erosion of the environment, which then caused and exacerbated public health and sanitation problems. My experiences in one of the hillside settlements were profound and can be described as sensory overload at every turn of the corner. Our guides and colleagues from the local community often told us the river that runs through the settlement was clean, pristine, and fresh before the civil war and its ensuing migrations. Their neighbourhoods lived in nature but not anymore. Not far away, there was a site of a tragic landslide which destroyed houses, livelihoods and claimed lives that occurred before my visit due to the unregulated land settlement that corroded the integrity of the hillside soil. There are many more examples of how social issues have instigated environmental degradation which then led to more social issues. While it is unfortunate and unintended on the part of the city’s population that struggles with livelihoods, it is nonetheless evident on how easy it is to disrupt the balance of the nature and consequently, a cycle of socio-environmental problems. -Adrian Pang

Sights from Circuit Breaker in Singapore

Living in the hustle and bustle of a city like Singapore, I hardly took the time to slow down and observe the unique ways in which nature co-existed in the urban jungle. During the Circuit Breaker period, I managed to come across wildlife that were probably always there, but I just didn’t take the time to notice. I now know that there are at least three Oriental Pied Hornbills that are resident to the area, and often like to sound their call around 3pm in the afternoons. There is also a White-throated Kingfisher that regularly perches at the canal, where a family of otters like to gather every morning after their breakfast catch. Because of the overgrowth of grass at this nearby field, fruiting mushrooms can now be seen growing in rings, especially after rainfall. The fungus root system underground grows from one central point out in all directions and produces mushrooms above ground as fruiting bodies. This sight is commonly known as “fairy rings” and have many myths and stories associated with it. Last but not least, I have been really enjoying watching the sunsets over the past few weeks. I think sunsets have definitely been getting better during this Circuit Breaker period. Could it be because of lowered pollution levels? Whatever it is, this time has reminded me to appreciate nature not only during travels to “nature sites”, but in the everyday. -Nicole Lim

Making a Difference

As a teenager, I was lucky enough to visit the Grand Canyon at dawn break. It had a profound impact on me, to see the marvel of our natural world, and to reflect on our many natural wonders. I decided there and then that I wanted to focus on environmental issues and make a difference. A passion that has carried me through 30 years dedicated to driving environmental change. We have a unique chance at the moment for change. I hope we can collectively take this opportunity to build back in a way that brings greater balance to both the environment, and society. -Carrie Johnson

Reopening economies – key risks and opportunities

By Nicole Lim

Today marks the last day of the “circuit breaker” in Singapore. Come tomorrow (2 June), Singapore will enter the first phase of the three parts to reopening the Singapore economy. Singapore is not alone, many countries and economies are already reopening while navigating through some semblance of a pre-COVID way of life – the new normal. How these upcoming weeks and months unfold will be critical for the fight against COVID-19, but also for setting our path towards a more sustainable future. How will we build back better?

Possible risks

The World Economic Forum (WEF) recently released two new reports which highlights key risks, challenges and opportunities the world is facing as a result of COVID-19. Based on inputs from 350 of the world’s top risk professionals, the COVID-19 Risks Outlook Report identifies the following most likely fallouts for the world, with economic risks topping the charts. This is no surprise, seeing as how the pandemic has halted much economic activity and saw governments pushing out trillions of dollars for recovery packages. Against this backdrop, these risks create far-reaching implications on ESG issues, as outlined in the report. Without going into too much detail, the environmental front will face risks from potential setbacks and stalling of progress for climate and environmental action. Countries run the risk of returning or developing emissions-intensive ways of operating as they look to reboot their economy post-pandemic. On the social front, WEF and many other thought leaders have identified rising inequality, negative effects on mental health, and long-lasting repercussions on youths, as some key societal risks. Cybersecurity and the inequality rising from the (forced) acceleration of widespread digital adoption has also been identified as a key risk. Underscoring all these risks is the need for strong, effective, and visionary governance practices to build back better. The report also outlines some key questions for decision-makers to consider.

An opportunity to build back better

Despite it sounding all doom and gloom, WEF also articulates that these risks are not forecasts – that decisive and bold action can set a path to a global sustainable recovery. Here’s a direct quote from the same report:

“As economies restart, there is an opportunity to embed greater societal equality and sustainability into the recovery, accelerating rather than delaying progress towards the 2030 Sustainable Development Goals and unleashing a new era of prosperity.”

The European Union’s proposal for a recovery plan which places emphasis on a green transition is one such example. The plan emphasises investing for the next generation, has significant funds directed at circular models and renewable energy, as well as proposals for adapting to new levels of digitalisation.

Beyond public sector responses, the report also notes that the global private sector will play a pivotal role in shaping a post-COVID future.

“As businesses seek to restructure supply chains, redesign manufacturing systems and respond to changing consumer demands, global sustainability could be shaped for years to come by the decisions taken today.”

In Singapore, we are seeing signs of such a green recovery from the private sector. Just last week, it was announced that CapitaLand secured a four-year S$500m sustainability-linked loan form UOB. This comes with Group CEO Lee Chee Koon highlighting that,

“The pandemic has raised global awareness of the importance of ESG (criteria), as major disruptions to businesses can come from anywhere… We are reviewing CapitaLand’s sustainability strategy… which will allow (us) to better future-proof our company.”

Also last week, the National University of Singapore (NUS) raised S$300 million through its inaugural green bond. Being the first of its kind among Asian universities, the bond will go towards financing green projects, which will be evaluated against NUS’ new Green Finance Framework. The university will be working alongside two major Singaporean banks, DBS and OCBC, on this commitment. Innovations and partnerships such as these would be pivotal in a post-pandemic recovery.

Be it in the public or private sector, one thing is certain – this pandemic has given the world the tools to manage a global risk. From newfound working practices, to altered ways of commuting and consuming, and to galvanising a global cohesive response to a crisis – emerging from this pandemic, we will have the opportunity to build back better.

Living in the Plastic Age

Located at 11,034 meters below the ocean surface in the Pacific Ocean, the Mariana Trench is the deepest part of the world. The third and most recent dive on May 13, 2019 by a businessman-turned-explorer Victor Vescovo, broke the previous record by 11 meter to become the deepest human dive in history (Morelle, 2019). These expeditions were crucial for humans to understand the oceans a little more – since it is widely believed that we have only explored 5 percent of our oceans. Unsurprisingly, there were amazing discoveries of new wildlife and microbes in the abyss. But when BBC reported on Vescovo’s dive, the headline simply read: “Mariana Trench: Deepest-ever sub finds plastic bag”. Several other news outlets like the Independent and CNN reported in similar fashion (Baynes, 2019; Street, 2019). A milestone in human exploration was overwhelmed by a sombre undertone invoked by the discovery of a plastic bag and candy wrappers at such depth (Wilkin, 2019).Worst, this was not the deepest known piece of plastic. The record goes to a flimsy plastic shopping bag found at based on the Deep-Sea Debris database – a collection of dive photos and videos recently made public (Gibbens, 2019).

Humans have produced 8.3 billion tonnes of plastics since its industrial-scale production thrived in the 1950s (Siegel, 2018). However, with only nine percent of these plastics recycled, 79 percent went into dumpsites and the wider environment (ibid). Consequently, this plastic trash was leaked into waterways and into the oceans. As of 2010, it is estimated that 4 to 13 million metric tonnes of plastic waste is dumped into the oceans annually (Gibbens, 2019; Babayemi, et al., 2018; Xanthos & Walker, 2017; Groden, 2015). And in less than a century, plastic accounts for 60 to 80 percent of marine litter (Raubenheimer & McIlgorm, 2018). As a result, plastic trash has been found in even the remotest coastal areas in the world. Uninhabited remote islands such as Henderson Island in the South Pacific, is estimated to have more than 38 million pieces of plastic washed ashore – with 13,000 pieces coming in every day, making the coral atoll one of the most densely polluted places on Earth (Dauvergne, 2018a). Elsewhere, there are currently five plastic gyres circling in the world’s oceans.  (Siegel, 2018). At the current pace of consumption, ocean plastics could treble in a decade and it is estimated that plastics will outweigh fish by 2050 (Dauvergne, 2018a; Harrabin, 2018).

Much of this litter is hazardous to wildlife in the marine ecosystem where 700 marine species have been found to interact with marine debris (Vince & Hardesty, 2017). Macro plastics in the forms of ghost nets, plastic bags, plastic straws, cigarette butts and etc. have caused entanglement, starvation, suffocation, laceration, infection, indigestion, reduced reproductive success and mortality (Xanthos & Walker, 2017; Lytle, 2017). Midway Atoll, also a small group of islands in the South Pacific, is labelled as an “albatross graveyard” for the mass deaths of Laysan Albatrosses from plastic ingestion. 1.5 million of these birds have plastic traces in their digestive systems (Walsh, et al., 2016). Moreover, it is found that most microplastics ingested by marine lifeforms have transferred up the food chain. Statistically, an average European seafood eater would ingest an average of 11,000 pieces of microplastics annually. . Unfortunately, humans do not understand fully the health effects of ingesting microplastics (WHO, 2019).

Even so, responses to this massive problem remain lacklustre. This shortcoming is worsened by the sudden waste crisis instigated by China’s waste import ban. This turning point showed the fragility of a global dependence on a single importer as the waste management order (Brooks, et al., 2018). The constant push for market mechanisms to address environmental issues have complicated governance and bottlenecking any substantial efforts to curb the problem.

One Man’s Trash is Another’s Treasure?

Trading recyclable waste was viewed as a sustainable solution of waste management. In fact, this method was noted by the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal (Basel Convention) (elaborated below). Wastes of one country such as metal scraps, papers and plastics can be reused, recycled or regenerated as second hand, functional resources or secondary raw materials for another (Siegel, 2018). Unsurprisingly, this solution stimulated a new market –recycling trade market. The world traded more than 191 million tons of waste in 2007, a staggering 67 percent increase over a five years period from 2002 (Kellenberg, 2012). The market currently possesses a net worth of USD 200 billion according to the Bureau of International Recycling (Blood, et al., 2018). However, recent studies have found recycling appears more as a smokescreen for Northern countries to dump their waste in other countries. In many cases, more stringent waste regulations at home have driven Northern countries to export their wastes to countries with cheaper disposal costs, lax environmental laws and inadequate handling capabilities (D’Amato, et al., 2018; Liu, et al., 2018). Kellenberg (2012) found a positive correlation between trading countries, where for every one percent that a home country’s environmental regulations deteriorate in relation to a foreign bilateral trading partner, the home country experiences a 0.32 percent increase in waste imports from the trading counterpart.

Plastic wastes are also seen as recyclable or reusable to become second-round raw materials for many developing countries. Global import and export of plastic waste grew 723 and 817 percent from 1993 to 2016 respectively and trading became even more lucrative in this past decade, raking in USD$5 billion annually (Earley, 2013; Brooks, et al., 2018). Coinciding with the country’s rapid industrialization, China also saw economic incentives in recycling plastics. The country collectively with Hong Kong, imported over 70% of these wastes (Earley, 2013). For a while, the world had a rubbish bin that is China. 43 out of 123 plastic exporting countries sent their plastic wastes to China (Brooks, et al., 2018). However, gradual economic development and rampant exploitations of China’s lax environmental regulations degraded the country’s natural environment. This prompted the central government to declare “Operation Green Fence” in 2013 to curb illegal imports of dirty, hazardous and useless wastes (including plastics) – often mislabelled as recyclables, through intense custom monitoring and inspections, while also reducing illegal foreign smuggling and trading of the materials (Sun, 2019; Brooks, et al., 2018). A permanent policy that banned almost all plastic waste imports – the National Sword was implemented in 2017.

China’s sudden rejection of plastic wastes had Northern countries scrambling to look for new buyers of their rapidly towering waste at home (Margolis, 2018). They started eyeing other Asian (predominantly Southeast and South Asian) countries like Thailand, Vietnam, Malaysia, India and Sri Lanka to be their next dumpsites (Tan, et al., 2018; Siegel, 2018). In Southeast Asia, the massive influx of plastic wastes coincided with the region’s economic boom, worsening the region’s existing plastic waste crises. This is because waste infrastructures, incineration facilities and landfill sites are inadequate to handle 80 percent of plastic waste that is not commercially viable for recycling (Dauvergne, 2018b). Consequently, plastic wastes often leaked into water systems and into the oceans. Together with China, Thailand, Vietnam, Indonesia and the Philippines account for 60 percent of plastic waste in the oceans (Chow, 2015). Another Southeast Asian country – Malaysia is also among the top 10 polluters globally.

However, the plastic problem is merely a national issue for these countries. Rather it is a systemic problem that transcends boundaries, geographies and jurisdictions. Actors from the local level to international level are intricately connected through vast and complicated networks shaped by power relations and knowledge that revolved around fundamental discourses of today in economics, ecology and sustainability. Plastic waste trading is perhaps not a viable solution in the long-term. Therefore, it is imperative to foster positive dynamics of and between current international relations, national governances, private corporations and local grassroot movements, and attempts to initiate more meaningful conversation on the efforts to deal with this compounding environmental issue.

The Current Discourse around Plastic Waste Management

At present, there are increasing policies, strategies, good intentions and actions to address the issue of ocean plastic pollution. The United Nations Environmental Program (UNEP) is the flagship intergovernmental environmental organization that has been a leading voice in international efforts to deal with this issue. International guidelines and policies like the Basel Convention governs international movements of hazardous waste (Alter, 1997; Lepawsky, 2015). Its creation was necessitated after a series of international hazardous waste trade controversies that resulted from (and highlighted) inequitable waste trade relationships between developed and developing countries where hazardous waste trades have caused untold harms to receiving countries – usually developing countries’ environment and public health. (Choksi, 2001). Fortunately, the introduction of BC in 1987 was able to curb egregious dumping of hazardous waste in poor developing countries (Alter, 1997). Plastic waste trade was subsequently included in the provisions of the Basel Convention and has leapfrogged conventional hazardous waste trade to become one of, if not the most pressing issue in recent years.

On national fronts, countries worldwide have taken various actions to address this mounting environmental issue within their borders. Costa Rica, Kenya along with many African countries Bangladesh, and China have taken the significant steps to ban single use, disposable plastic bags. Whereas many other countries have implemented monetary or incentive driven policies or regulations to address the issue. The most notable example is the plastic bag levy that is increasingly popular in many countries (Rivers et al. 2016; Jakovcevic et al. 2014; Poortinga et al. 2013; Ohtomo and Ohnuma 2014; Martinho et al. 2017; Thomas et al. 2016). In Singapore, the National Environmental Agency is a leading figure in guiding the country towards using less plastics through its consistent and comprehensive studies on the matter.

Plastic waste reduction constitutes a significant part of the country’s Sustainable Singapore Blueprint 2015. Singapore aspires to be a Zero-Waste Nation and as such, is focusing on “reducing consumption of materials as well as to reuse and recycle materials to give them a second lease of life” (Ministry of the Environment and Water Resources, et al., 2015). The country has also set targets for the national domestic and non-domestic recycling rates to increase 11% and 4% respectively by 2030. The Singapore Environmental Council (SEC) has conducted a study on the country’s plastic waste ecosystem and concluded with several recommendations to overhaul the country’s plastic waste management capacity (Singapore Environmental Council, 2018).

Corporations and Organisations as Leaders

Several recommendations, namely innovation to reduce plastic packaging waste, building a financial market for recycled plastic through innovation, replace single-use plastic bags / rolls with alternatives and legislation and policy measures are hugely relevant for corporations and organisations to adopt and pursue. Cue the circular economy. A circular economy is an economic system that aims to gradually decouple economic activity of non-renewable, finite resources by promoting the reuse, recycling or regeneration of used materials to give them new leases of life. In so doing, the potential to reduce as well as avoid unnecessary resource extractions and wastage from the planet is immense. As of 2012, plastic production accounted for about 4% of global oil production which is possibly much higher today (Slav, 2019). A reduction to this figure through lower production and consumption of plastic products would still contribute to significant reductions of carbon emissions annually. From a financial perspective, adopting a circular model to plastic consumption can also reduce operational cost through the reduction of raw materials procurement and processing. A major study by the Ellen MacArthur Foundation in 2015 concluded that adopting a circular economy generally could enhance Europe’s productivity by 3% by 2030, generating cost savings of €600 billion a year and €1.8 trillion more in other economic benefits (McKinsey & Company, 2017). Therefore, private entities should capitalise on their potentials and capacity to make significant strides in plastic waste consumption and management. The several recommendations by SEC are precisely components that can enable this to happen. From production to consumption, companies should innovate new methods, technology and practices to not only reduce their own plastic consumption but also to be role models in encouraging the public to adopt these essential habits, measures and practices. Moreover, investments in new innovations and technologies to improve plastic waste management will lower further their costs and expenditure in the medium to long term. In a nutshell, corporations and organisations of any sector should actively seek for ways to transform their supply chain and services to adhere to the principles and practices of a plastic circular economy. Internally, entities should also implement guidelines and instil habits and values among employees around the consumption of plastic products to reduce unnecessary plastic waste. They should, through coordinated efforts, aim to be leaders in driving the transition of plastic lifecycle in Singapore from a linear to a circular economy.

Let Us Join in the Fight against Plastic Waste Disaster

These approaches to reduce plastic consumption can have trickle-down effects on the grassroot levels and the public. That leads to you and me, the daily consumers and individuals. We should each play our part to be conscious consumers. Afterall, any plans or strategies would falter if the individuals and public do not subscribe to it. In 2019, Singapore generated 930,000 tonnes of plastic waste (National Environmental Agency, 2019). That is the equivalent of 165kg of plastic waste per person annually or the equivalent of four dead whales like the one that washed up on one of the Philippines’ shores with 40kg of plastic bags in its stomach (Vaughan, 2019). Therefore, it is important to remember that one person CAN make a difference. So, let us do our part, bring a reusable tote bag to the market, avoid double layering the plastic bags and bring your own tumbler and containers when we order takeout while companies and governments continue to make significant progress to prevent the world from sinking further in plastic waste.


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Building supply chain resilience through sustainability

Five action plans for businesses to adopt after covid 19

Planning ahead
The global events in the last few months have demonstrated the high importance of supply chain management for many businesses. COVID-19 has caused an unexpected, global supply chain disruption, leading several businesses to re-examine their supply chain risks and strategies.

Moving forward, building supply chain resilience should not limit businesses to assess only their financial and credit risks. It is expected for them to move past these risks to also assess risks arising out of their supplier sustainability operations. Sustainability has played a vital role in recent years in shaping business strategies by influencing purchasing decisions. Supplier environmental compliance, workers’ rights and safety, and good governance are some of the aspects that have driven pressures from industry and buyers alike.

Past events have demonstrated loss of reputation, and consequently revenue, when sustainability risks are overlooked in supply chain operations.

However, due to the current economic slowdown and need to defend critical business assets, sustainability considerations might be pushed to the back seat. This might seem like a short-term success strategy, but in the long-term, it would be detrimental to the overall business growth. We are proposing five-step action plan for businesses to adopt, and to overcome short and long-term supply disruptions.

Action Plan 1: Protecting Human Capital should be a Key Priority
As one of the most vulnerable section of the supply chain, labourers and migrant workers face several challenges, especially concerning their livelihoods, health and safety. COVID-19 has put a spotlight on the living conditions of several such low wage earning workers, making them most susceptible to the virus.

Living in confined spaces with poor ventilation and minimum space to move, there has been mass spread of the virus among these communities. While businesses and economic activities have been halted in many of these countries, there has also been widespread unemployment and job insecurity bringing a lot of these workers to the brink of poverty.

This raises questions on measures to safeguard workers’ health and livelihood, key to wider business ethics. Priority given to protecting human capital must take precedence for any business and this should be followed through in the supply chain.

The ‘new normal’ must embrace the concept of social sustainability assessment for suppliers as part of the procurement procedure to gauge how suppliers are providing for their workers and their sustainability. Worker health, safety and security must be built into our suppliers and our business continuity plan to ensure a supply chain operation.

Action Plan 2: Supplier Environmental Risk Assessment while Sourcing
Several businesses facing supply chain disruptions currently would possibly look at switching suppliers to ensure future business continuity. Diversifying supplier base has been known to prevent major disruption of product supply. Businesses often deprioritise sustainability while sourcing for new suppliers.

Operational necessities such as price, quantity and quality often take precedence over sustainability concerns. However, for business continuity, it is critical for business to also look at supplier sustainability risks prior to sourcing.

According to a report by the World Economic Forum, environmental risks, in particular, have high impact and likelihood of occurrence in the coming years (The World Economic Forum, 2020).

These include climate action failure, extreme weather and natural disasters, which have in the past been known to severely disrupt the supply chains (an example, 2011 Thailand’s severe flooding disrupted several supply chains). Environmental sustainability risk assessment of suppliers could supplement the operational considerations during sourcing to avoid future supply disruptions.

Action Plan 3: Strengthening Supplier Partnerships and Customer Relationships
COVID-19 has played a spoilsport in managing relationships with suppliers, highlighting the dark side of procurement practices for many businesses. According to a recent report by Sustainable Apparel Coalition, many fashion brands have cancelled completed orders from their supplier manufacturing units (Sustainable Apparel Coalition, 2020).

Cancellation of completed orders brings about a ripple effect – from mistrust across industry players, economic instability to suppliers, and wide-spread unemployment of workers. This might lead to negative consequences for the business when the economy recovers. Businesses need to make meaningful partnerships with suppliers that extend beyond financial and material transactions, to sail through unprecedented events such as COVID-19.

Strengthening customer relationships is as important as strengthening supplier partnerships. In this tough time, customers are also facing economic instability and constraints that is changing their purchasing behaviours. Moving forward, businesses need to extend beyond the traditional role of providing goods and services to customers, to that of engagement and purpose. Maintaining transparency and following through on their commitments are key ways for gaining customer trust and maintaining a healthy supply chain.

Action Plan 4: Executing Scenario Planning and Waste Mitigation Strategies
Supply chain disruptions brought about by COVID-19 has resulted in higher inventory, therefore leading to longer lead times for many businesses. For sectors handling perishable items, this would translate to a lot of wastage. For the food industry alone, processing and transport breakdown, as well as panic buying has resulted in soaring prices and rotting crops posing a global food crisis.

Post COVID-19 would have to look at supply chain operations to devise plans to ensure crisis management and business continuity strategies. Businesses need to explore using several scenarios that could disrupt various stages of their supply operations, and devise waste management plans accordingly.

This might even mean relooking at diversifying customer base in addition to supplier base, also targeting waste mitigation strategies during times of crisis. Building collaboration with various stakeholders in the supply chain would help in overcoming some of the pain points. Avoiding waste could avert disposal costs for larger volumes of items and could also generate alternate revenue streams during crisis.

Action Plan 5: Digitalisation of Supply Chains>
Efforts to digitalise supply chains have been ongoing for many years. Many of our current products go through complex, global network of processes before reaching the end consumers.

Businesses are now starting to look at investing in technology and digitalising the supply chain to help better forecast the demand and manage diversification. Some data analytics tools provide opportunities to identify vulnerabilities in supply chain operations and predict risks.

Digitalisation could also help in real time inventory visibility, provide optimal transportation routes, and reduce lead time. All this would improve performance and reduce waste. Digitalisation is the future of enhanced supply chain management.

Sanjala Hari
Senior Consultant
Paia Consulting Pte Ltd


Regulations on packaging, food and e-waste

Paia Consulting hosted our very first online breakfast briefing together with guest speaker and environmental lawyer Joseph Chun on 15th April 2020, introducing the new waste regulations under Singapore’s Resource Sustainability Act.

Singapore’s only landfill, the Semakau landfill, is predicted to run out of space by 2035 at current waste generation rates. To reduce the amount of waste generated in Singapore, the Ministry of Environment and Water Resources published a Zero Waste Masterplan in 2019, Singapore’s designated Year of Zero Waste. The plan outlines a series of measures that the Singapore government will take in order to reduce waste (per capita) sent to landfill by 30% by 2030.

As part of the masterplan, the Resource Sustainability Act was introduced to accelerate the reduction of waste in three priority waste streams: electronic, packaging and food waste. The Act partially came into force on 1st January 2020 and will first require producers of regulated electrical and electronic products to be responsible for the collection and treatment of their products when they become waste, from July 2021. Companies that introduce packaging material into the Singapore market will eventually be required to do something similar by 2025, but as a first step, they are required to collect and report information on the type and amount of packaging material that they place on the Singapore market, as well as plans to reduce packaging waste, from 2022*[1].

The Act also requires commercial and industrial premises generating large amounts of food waste to properly segregate and treat food waste from 2021. New buildings will be required to allow for on-site treatment of food waste from 2024.

On the day of our breakfast briefing, figures released by the National Environment Agency (NEA) showed that about 7.23 million tonnes of solid waste was generated last year compared to about 7.7 million tonnes in 2018, making this the third yearly reduction since 2017. Will the Singapore Resource Sustainability Act see a continued decrease of waste generated in Singapore?

Paia Consulting has experience working with companies on materials and waste reporting and strategy. Whether you are affected by the new regulations or would simply like strategic support in helping your company reduce waste, we can help you. Contact us to find out more.

[1] Original timeline of 2021 has been revised due to COVID-19


Paris Agreement in Jeopardy? A Summary of CNA’s Carbon Conundrum

By Adrian Pang, Paia Consulting Pte Ltd

Channel News Asia’s documentary series earlier this month zoomed in on an impending disaster that is already set in motion – climate change or more accurately, anthropogenic climate change. The documentary explored the world’s profound reliance on carbon-intensive energy resources but highlighted some progress made in moving away from the self-destructing carbon addiction to provide a glimmer of hope of what could and should be done in the limited time to restore nature’s equilibrium. In the process, the documentary took mainly a Singapore-centric view complemented by international events and perspectives on the dire consequences of climate change and on finding solutions.

This piece provides a summary of the key messages conveyed by the documentary. The content follows the narrative of the documentary. First, it highlights the root cause of climate change: our addiction to fossil fuels that resulted in the dire situation and consequences regarding carbon emissions the world finds itself in. The next part of the summary presents provides a more optimistic outlook to the future with the developments of potential solutions in renewable energies as well as the simple yet complicated gesture to give agency back to nature to recover. First, the documentary reiterated the existence of potential solutions in the form of solar energy and green hydrogen. In Singapore, these potential solutions are undergoing consistent and significant development and testing. Thus, the most pressing issues is not about finding solutions but rather our willingness – government and corporations’ willingness to invest in these long-term solutions. Then, the documentary highlighted the abilities and importance of nature to regenerate itself and for us humans to coexist harmoniously with, if not live by laws of nature. The piece concludes on a note of caution that now is the time the world should drastically cut carbon emissions before climate change escalates to a point of no return very soon.

Carbon Junkies and the Consequences

Sequestered carbon from millennia of natural lifecycles of living beings that were formed into fossil fuels (coals, oil, natural gas, etc.) was always a natural process and fossil fuels were meant to be stored deep underground. However, this process was disrupted ever since the industrial revolution ushered in a new age of human progress that sees the stripping of Mother Nature’s resources as key to societal development. Human’s unquenchable thirst for fossil fuels for energy is the quintessence of this problem. As humans continue to pride ourselves on the technological advancements made in the past couple of centuries, we are ironically and rather stubborn sticking with carbon-packed resources to power our technological innovations and ingenuities. We have never moved on from fossil fuels as our primary energy sources. In fact, we fell deeper into the addiction problem to keep economies of oil-producing countries and financial markets well-oiled (pun-intended). Earth’s atmosphere was meant to be the protection but humans decided it is in their best interests to burn fossil fuels in the name of progress, thereby causing untold stress to this planet’s immune system that reduces harmful greenhouse gases like carbon dioxide. And burn we did for close to 300 years. In the process, we re-released inconceivable amount of carbon dioxide into Earth’s atmosphere.

In November 2016, the global community seemingly put aside their differences and set the world on an era defining path that was unimaginable just decades ago. 189 countries, even the reclusive hermit kingdom of North Korea, ratified or acceded to the Paris Agreement to begin intense carbon reduction to keep global temperatures in the 21st century to well below 2 degree Celsius above pre-industrial levels as well as to limit the temperature increase even further to 1.5 degree Celsius. The world committed to embark on several grand steps towards this common mission. First, carbon emissions and temperature rise should peak by 2020. Then, emissions should be halved by 2030 and the world needs to be completely decarbonised by 2050. Alas, the world now finds itself slowly creeping back to square one as the euphoria waned. The 1.5-degree Celsius targets based on current data are unreachable. Carbon emissions worldwide continue to rise. Countries’ support for this once hopeful – an understatement, milestone that showcased the best of humanity are being challenged at its core as individual economic interests supersede what needs to be done. The dwindling commitment is further exacerbated by the withdrawal of the United States, the biggest economy and biggest emitter in the world. Worst, the Trump administration ramped up fossil fuel production for their national economic interests. Ultimately, the world continues to find itself losing time faltering on significant efforts to protect and save itself from the dire consequences of climate change.

While climate change does indeed spare no-one, smaller nations, especially island nations are already bearing the full brunt of human’s inactions. The documentary went to Tuvalu, one of the smallest nations in the world located in the South Pacific between Hawaii and Australia. It showcased the plights of the country sinking fast beneath the sea to highlight the devastating effects of rising sea levels – the rate of which is faster in the past few decades than the last few thousands of years. When compared to more industrialised nations, all 57 small islands developing states (SIDS) including  (The Economist, 2019). [1] Yet, these countries are on the forefront of the consequences caused largely by their much larger and mightier industrialised counterparts. In the case of Tuvalu, their commendable efforts to slow their home from sinking through various adaptation mechanisms are increasingly futile. The country’s prime minister even gave grave warnings that climate change adaptation and resilience are no longer viable for his county and other SIDS. The documentary then revealed coastal and archipelago nations are the next in line to suffer the consequences of climate change. For example, 2,000 Indonesian islands and 20% of Bangladesh would be submerged under water by 2030. It will not be long before New York City and Amsterdam – great industrialised cities would sink beneath the waves by 2100 if sea level rises 1.5m, as per the current pace of climate change.

Singapore will not be spared either. Singapore is on course to lose of land to rising sea levels at the current trajectory according to the documentary. This problem is further compounded by the emergence of the fast emerging arctic sea route from melting ice caps, in which the new trade route is 33% shorter than the current one that has for so long made Singapore one of the trade centres of the world. This imminent new trade route would threaten the displacement of Singapore as a global commercial and trading hub, reducing the country’s competitiveness and even relevance in the global economy in the not too distant future. Singapore’s government has pledged SGD 100 billion to increase the country’s resilience to rising sea levels. Raising tidal gates, dykes and reservoirs, building the new Changi airport terminal more than 5m above sea levels and polders to reclaim land below sea levels are some of the measures taken. Even so, the pace that sea level is rising, and climate change worsening is gradually prompting the conversation in Singapore to shift ns much like the aforementioned sentiments by Tuvalu’s prime minister.

Stemming the Tide through Long-Term Solutions

The best solutions are none other than those that address the issue at its core, reducing carbon emissions within its own shores while hoping the rest of the world continue to play their parts. While existing steps to reduce carbon emissions would incur significant costs in the near future, the potential long-term impacts and values far outweigh the initial costs. short, the climate driven sphere has the highest job and business opportunities while the current linear economic business models destroy value and will slowly but surely be phased out. However, the pace of it happening is still a key factor in preserving the sanctity of Mother Nature and the climate. In view of these potentials while being mindful of the limited time before climate change is worsened beyond reparation, Singapore is taking bold but necessary steps to address the climate risks dawning upon our home. The main solutions covered by the documentary focus predominantly on technological innovations and Mother Nature herself.

i. Transition to Renewable Energies: Solar Power and Green Hydrogen in Focus

The most direct and logical steps to reduce carbon emissions is to generate electricity and energy through low carbon renewables. In short, reduce or even eliminate fossil fuels from the energy equation. This is the most obvious way forward because technologies are already in place and have proven capacities to replace fossil fuels as the biggest energy generator. . This technology will only get better with more investments and refinements in the future. Several innovations in Singapore can attest to the immense potential of the PV systems and the even higher ceiling of what this technology can achieve.

a. Building Integrated Photovoltaic (BIPV) Systems

Source: (SERIS, n.d.)

In a building design and architectural sphere, the Solar Energy Research Institute of Singapore (SERIS) and the School of Design and Environment at the National University of Singapore (NUS) have jointly designed, built, and are managing, refining and improving on the concept of BIPV where solar panels are fitted to the façade of a building to achieve the higher generation of solar generated electricity to become an energy self-sufficient and zero carbon emitting infrastructure. So unlike solar panels that are placed on rooftops, the solar panels are integral to the infrastructure, for example as and facades. Moreover, additional electricity generated can be fed back to the major electricity grid or be stored in battery for future use. SERIS stated that there are some 160,000 buildings that have the capacity to install sizeable BIPV systems far larger than the current testbed. In short, there is huge potential and benefits if Singapore decides to venture down this path.

b. Floating PV Systems

Elsewhere, the government’s Economic Development Board (EDB) and the Public Utilities Board (PUB) have also collaborated on taking PV systems to the next level. The collaboration aims to evaluate the performance of different solar systems and their impacts on the environment. As a result, the joint venture has produced largest floating solar panels testbed with 10PV systems across 1 hectare on water currently in the world according to the documentary. In fact, this trial has generated better results than expected as it was found that the cooling nature of water enables the PV to be more efficient. The floating PV systems generated 5% to 15% higher electricity than typical rooftop systems as well as possessing capacities to power 200-odd 4-rooms HDB flats per year, all the while having minimal environmental impacts. With such positive outcomes from the testbed, both EDB and PUB have targeted to introduce floating solar projects in the Bedok reservoir and Lower Seletar reservoir by mid-2020. Furthermore, the joint venture wants to introduce even larger scale floating PV systems 50 times the size and capacity of the existing testbed that can generate 6,000 MWh of electricity by 2021. This target is set with the goal of ramping up 2-Gigawatt Peak solar capacity that can power 350,000 households or 4% of total electricity demand in Singapore daily by 2030.

c. Commercial Leadership & Intergovernmental Cooperation

Sunseap Group, one of the largest renewables and solar energy companies in Singapore has also aggressively attempt to push and drive Singapore and Southeast Asia to adopt renewable solar energy to generate electricity. The documentary highlighted Sunseap’s success story in the Ninh Thuan province in Vietnam on the positive environmental as well as social and economic impacts of solar PV systems. Sunseap Group has installed 449,880 PV modules in the province that can generate 20 million kWh of electricity to power 100,000 households every month. This is a significant development for one of the least developed regions in the country. The establishment of the PV farm has created positive social impacts such as providing better infrastructure and paved new roads for the local communities to connect with the urban and peri-urban areas. Economically, this project has created new jobs for the community. 2,000 employees were hired for the construction of the farms and 35 permanent positions were created after construction completion. This is one of many indications of Sunseap’s ability to be a leading figure in the development of the renewable energy sector in Southeast Asia or ASEAN region. As per Frank Phuan, CEO of Sunseap Group, he used the examples of the infrastructures in place in Malaysia and Singapore to upscale PV systems between the Johor Straits to accentuate on the fact that it is political will – whether ASEAN countries are willing to cooperate in this sphere to create a shared “ASEAN power grid” that balances countries with in the region with rich renewable energy resources against parts of the region that have high energy demands, that would determines the growth of renewables in this region. He added that the technicalities are no longer a barrier to prevent ASEAN countries from taking a huge leap towards transitioning to renewable energy.

d. Green Hydrogen

Amongst the more popular renewable energy sources like wind and solar, one source, one element has been under the radar and perhaps in the shadow of the former two counterparts – hydrogen. As the most abundant element in the whole of the universe, hydrogen also possesses the potential to become a clean and efficient alternative to fossil fuels. The only complication from venturing headfirst into using hydrogen as fuel source is its highly combustible nature. Moreover, the storage of hydrogen in conventional high-pressure tanks is not the most logistically and environmentally efficient manner to attain hydrogen if we consider the transportation of these heavy tanks. Fortunately, the Tohoku University in Japan is developing a new technology in the form of metal hydrides. Metal hydrides are metals which have been bonded to hydrogen to form a new compound. This compound, at the current stage of research and development are pointing towards the elimination of the conventional method of storing hydrogen in high-pressure tanks as it exists in metallic powder forms. But more research is required as the process of retrieving energy from the powdered metal hydrides requires high energy itself to heat and activate the compound.

Back in Singapore, a more basic form of metal hydrides system is undergoing testing. The testbed is also showing positive results. Instead of storing metal hydrides in powdered form, hydrogen is stored in a metal hydride tank using the same concept of binding hydrogen with metals. When electricity is needed, hydrogen is released from the tank and passed through fuel cells. Prior to storage, hydrogen is attained by breaking down water in a separate compartment in the testbed. Overall, the energy required for the entire generation process, from breaking down water to releasing hydrogen from the metal hydride tank only used electricity generated by solar panels. As a result, the Singapore Power Training Institute is the first zero emission building that is powered fully off the grid by green hydrogen in ASEAN region.

ii. Restoring Nature

It is undeniable that the ongoing coronavirus pandemic is grim and disruptive on all fronts. However, environmental lessons while secondary to public health, can be taken from this challenging time. The pandemic shows Mother Nature’s ability to regenerate herself over the short period of time when human activities almost came to a virtual standstill. Air pollution levels decreased quite significantly, rivers became clean and clear again and the air fresher. This is an indication that humans do not actually need to take draconian measures to make changes possible. Rather we can take modest but nonetheless significant steps to eventually phase out things that are environmental detrimental like excessive carbon while allowing the Earth to heal. Nature has a strong will and has shown time and again its ability to restore itself – think Chernobyl and the nature that reclaimed the abandoned city in just a few decades. Therefore, the message from the documentary is to give agency back to nature to do what it does best, to recover and regenerate itself. In particular, restoring plants and their habitats should be a priority in major efforts to help nature to recover because plants are nature’s front liners against rising carbon dioxide level. The documentary focuses on mangrove trees as exceptional carbon scrubbers. This plant species can sequester 3 to 5 times as much carbon as land-based jungles. Thus, experts are studying closely on ways to preserve, conserve and cultivate new habitats in historically alien environments in other parts of the world. Even so, the bottom line remains – preserve and plant more trees.

In so doing, nature’s recovery and flourishment will only further benefit human’s health. It is scientifically proven that the human biology is wired to sync harmoniously with nature. The practice of shinrin-yoku or forest bath in Japan shows how human’s immersion in nature can have healing effects on the mind and body. Therefore, it is a ‘kill two birds with one stone” scenario whereby a thriving nature benefit both humans and Earth. Shifting the focus back to Singapore, it is unsurprising that this belief in nature’s healing abilities has led to the restoration of freshwater wetland in Singapore’s Botanical garden. As a result, it not only restores habitats but also act as a potential water reservoir that redirects flood water from urban areas to the area to make this city state more flood resilient. In summary, we should strive to let nature reclaim its equilibrium and us humans should coexist peacefully with, if not live harmoniously in nature.

No Time for Caution and Complacency

Climate scientist assistant professor Angel Hsu of the Yale-NUS College summarised best the reason climate change is described as the “super-wicked problem”. One, time is running out and relatively little has been achieved. Next, many people currently entrusted to solve climate change are ironically people who are causing it due to their other interests and their questionable practices in the process, best demonstrated by how these people fly extensively to attend meetings to combat climate change. Third, there is no central authority in the fight against climate change. As a result, every country prioritises their own interests before the common necessity to fix the climate and environment. Finally, and most damning of all, the persisting paradigm that climate change is a problem for the future. In reality, there is no time for caution and complacency. Carbon dioxide must begin declining this year or the world risks an irreversible disaster. Systemic changes are needed where business leaders and governments pool together resources and expertise to deal with this common enemy. We are one species after all.

While Singapore has taken good strides to address climate change issues at home, we need to be conscious that there are still other areas that could be done better. For example, the country could accelerate the transformation of public transportation system. Electrifying public buses and increasing bicycle lanes should be fairly easy to be implemented in an enclosed and well organised country like Singapore. Shenzhen, which is roughly the same economic size as Singapore has electrified all their public buses in 5 years, Singapore can surely do better than setting this target to be achieved by 2040 (He, 2018). Therefore, we are only at the prelude of the fight against climate change and the climax will arrive quicker than ever. If we do not take significant actions, the crescendo [2] of the disaster will likely drown out any hopeful progress. And climate disaster will happen more as a caesura [3] to the end of human existence than a diminuendo [4] like most lifecycles.

[1] Singapore’s percentage of world GDP was 0.42% in 2017; total contribution to global emissions was 0.11% in 2017; Singapore’s population is equivalent to 0.08% of the total world population ( (, n.d.; Tan, 2019; worldometer, n.d.)

[2] In classical music tradition – gradually getting louder.

[3] In classical music tradition – a grand pause or dramatic break.

[4] In classical music tradition – gradually getting softer.

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Post Covid-19 pivots

We could not imagine the extent of the major economic, social and environmental impacts brought about by this pandemic. And just like climate change, we see post-Covid pivots as both a risk and opportunity. Here at Paia, we see an opportunity for a transformational agenda precisely because of the tests current systems are being put through. Here are some of our observations and lessons.

Sustainable Palm Oil – Not an Oxymoron

With the world’s population set to increase, consumption and use of oil and palm oil based products will rise exponentially. Palm oil is the most efficient oil among all other types of oil. We should not and cannot afford to boycott palm oil because that will be a total loss for the environment.

Introduction to Carbon Reporting

Paia is running a free breakfast briefing on the 16th July to help companies better understand the world of carbon footprinting. If you’re unable to attend, here is a short introduction to the why, who, what, when and how of carbon emissions calculation and reporting.

GRI Standards 2018 Update: Water and Occupational Health & Safety

by Lim Sze Wei and Cheryl Lee Shi-Ying. In 2018, the Global Sustainability Standards Board (GSSB) released revised versions of GRI 303: Water 2016 and GRI 403: Occupational Health and Safety 2016 standards, as part of a continuous improvement process to keep the standards up to date and aligned with key reporting frameworks.

Climate change

Is the world sleepwalking into a climate crisis?

by Nik Bollons.

As world leaders meet this month to talk about the state of the global economy, climate change should be a key agenda item.

World leaders and top executives are currently meeting in the sleepy, snow covered Swiss ski resort of Davos to discuss key geopolitical issues  – and how to address them. Likely topics include the predicted slow-down in the global economy, increasing geopolitical tensions, ongoing trade disputes and increasing nationalism (amongst others).

Other Agenda Items

But according to The World Economic Forum’s Global Risk Report 2019 released ahead of the meeting, leaders should also allocate time to discuss ‘environmental risks’. The report – authored by leading economists and academics – highlights that risks such as climate change are likely to have significant impact on long-term global development.

‘Extreme weather’ is highlighted (again) in the report as the top global risk in terms of probability and impact on global development, with the ‘failure of climate change mitigation and adaptation’ and ‘natural disasters’ in second and third place respectively.

The Importance of Climate Risks

We operate in an increasingly globalised, fast paced and changing world. Climate risks (such as sea level rise, changing patterns of extreme weather events as well as ‘transitional risks’ such as carbon taxes) are increasingly likely to add more disruption to already stretched supply chains, change the flow of capital away from ‘dirty fuels’ to renewable energy and alter consumer purchasing behaviour.

We can already see this happening.

For example, the Californian utility company PG&E has become one of the first ‘climate casualties’. PG&E is heading towards Chapter 11 bankruptcy in the US due mainly to the financial impact from the 2017 and 2018 wildfire season – or what it terms ‘climate-driven extreme weather’.

Direct Climate Risk in Singapore

What do climate change risks look like for Singapore?

According to the Singapore Government’s Climate Action Plan, physical impacts of climate change to Singapore include:

  1. increasing intensity and frequency of heavy rainfall events,
  2. an increase in daily temperature by 1.4C to around 4.6C; and,
  3. predicted rise in sea levels of 0.76m.

These risks may disrupt transport and infrastructure and reduce the durability and lifespan of buildings and assets (key sectors in the Singapore economy). Risk also provides opportunity for some companies and certain sectors– increasing temperature increases demand for air conditioning (and energy).

The Singaporean government is responding to many of these issues through strengthening key assets and infrastructure and disaster preparedness.

Indirect Climate Risk in Singapore

But there may be other indirect impacts of climate change to the Singapore economy.

Singapore imports 90% of all of its food from overseas. According to the International Rice Congress, climate change across the Asian region could increase rice prices by more than 30% by 2050. That’s roughly a 1% increase per year between now and 2050. This will impact domestic markets, and foreign rice trade.

Singapore has a significant tourism industry including package travel to destinations all-over South-East Asia. However, climate change is already impacting the tourism industry. For example, Maya Bay in Thailand – famously featured in “The Beach”, starring Leonardo DiCaprio – was closed in 2018 to recover from over use and effects of rising sea temperatures.

Some of these risks may or may not play out, and we don’t know exactly what their impacts will be.

Scenario Analysis

Companies therefore need tools to understand the direct and indirect impact of possible climate risk to their business.

Employing scenario analysis and running ‘what if’ exercises based on recognised climate impact assessments can provide useful ways to identify key risks, and quantify their financial impacts.

This methodology can include simple qualitative based workshop-style exercises with key members of operations and risk, through to modelling of supply chain impacts all the way to complex financial impact analysis.

These approaches help identify climate risks with the greatest financial impact to the business. They also provide a strong foundation to build adaptation and response strategies.

Time to wake up

The majority  are watching the meeting in Davos to see what direction will be set on pressing short-term global economic issues.

A smaller minority are  looking to see what the meeting says about long-term environmental risks like climate change.

Failure to do so may result in a painful wake up call in the not too distance future.

Nick Bollons is Principal Consultant at Paia Consulting Ltd in Singapore.

Nick specialises in financial risk assessment of climate change.

scenario analysis risks opportunities

Applying Scenario Analysis in Climate-related Risks and Opportunities

by Lim Sze Wei & Stefan Ullrich.

Investors are beginning to get on board with the global fight against climate change, a movement that was until recently the territory of non-profit organisations and environmentalists. According to the inaugural Global Climate Index 2017 for Asset Managers by the Asset Owner Disclosure Project (AODP), a majority of 60% of asset owners are now taking action on climate change, while 40% continue to ignore the associated risks and opportunities. The report also found that the world’s top 50 asset managers are well ahead of their asset owner clients in their approach to managing the financial impact of climate change on investment portfolios [1]. Blackrock, the world’s largest investor with US$6.317 trillion [2] assets under management (AUM) has warned that high-level directors could be voted out of companies that are failing to mitigate climate-related risks posed to individual firms [3].

Investors are increasingly paying more attention to companies’ environmental, social, and governance (ESG) issues, urging them to disclose the impacts of climate change on their business and assessing how these topics are managed. It is therefore very likely that shareholders will increasingly demand responses to ESG related topics, specifically climate-related risks, in the near future.

In response to the growing demand for organisations to properly assess, understand and report climate-related risks, and at the request of G20 leaders, the Financial Stability Board (FSB), a body that makes recommendations on the global financial system, established the Task Force on Climate-related Financial Disclosures (TCFD) in December 2015.

In its recommendations for organisations from both the financial and non-financial sectors, published in June 2017, the Task Force concluded that a key forward-looking tool to grasp the complexities of climate change is scenario analysis and recommended that companies explore physical, strategic, and financial risks and opportunities that could emerge from a range of climate-related scenarios, including a 2oC scenario. (Note: An increase of global temperature by more than 2°C has come to be the majority definition of what would constitute intolerably dangerous climate change. The UNFCC Paris Agreement’s key aim is to keep global temperature rise to well below 2°C above pre-industrial levels and to ideally limit the increase to no more than 1.5°C.)

What is scenario analysis?

Scenario analysis (sometimes called “scenario planning” or “scenario and contingency planning”) is a structured process for organisations to analyse possible future events by considering several scenarios i.e. stories about how the future might unfold and how it will affect them. It is a tool that intends to explore alternatives that may significantly alter the basis for “business-as-usual” assumptions, therefore enhancing critical strategic thinking.

While scenario analysis is a relatively recent tool to asses climate-related risks and opportunities and their potential business implications, it is an established method for developing strategic action plans that are flexible and robust to cover a range of future states.

Scenario analysis is also a good ‘storytelling’ tool in connecting the various and complex interactions, behaviours and emergent properties of our natural, economic and social systems. It recognises the ‘human science’ perspective in the diverse epistemologies of the climate, economic, and social narrative. It assists multiple business actors to broaden the focus to encompass a richer set of considerations thus providing decision makers with the understanding of complex systems associated with climate-related risks and opportunities, effects from various forms of intervention, and to then tailor strategic and targeted approaches in managing these risks.

The tool is also useful in helping transcend sustainability and climate change discussions from just the sustainability department, into the boardroom and the offices of the CFO, COO, CIO, etc. – thereby strengthening internal relations of an organisation and its ability to respond quickly and effectively to emerging threats and opportunities.

Given that the foundation of scenario analysis is based on forward-looking assessments, it is also a useful communications tool for informing stakeholders about the organisation’s position pertaining to climate-related risks and opportunities.

How to use the scenario analysis?

If your organisation is just beginning to use scenario analysis, the TCFD recommends that you can begin with qualitative scenario narratives of storylines. As your organisation gains experience with qualitative scenario analysis, the scenarios and associated analysis of development paths can be guided by quantitative information such as using datasets and models (e.g. developed in-house or provided by third-party providers) to illustrate pathways and outcomes.

In identifying scenarios, the TCFD recommends using a range of scenarios that enlighten participants on the future exposure to both transition and physical climate-related risks and opportunities, tailored to the industry, economic sector, and geographical location of the organisation’s value chain.

A key scenario recommended by the Task Force is business-as-usual, which is critical for identifying the likelihood of physical risks (e.g. water scarcity, land degradation, flooding, extreme weather events), their magnitude and the necessary adaptation measures. This scenario will assist organisations with understanding the physical impacts from acute and chronic weather events which will interrupt businesses and operations across the supply chain.

Another key scenario which the Task Force recommends is a scenario which is consistent with keeping global warming below 2oC. This scenario assesses transition risks and its impacts under the assumption of meeting the science-based targets (SBT), in alignment with agreed international climate change commitments. This scenario will assist organisations to identify reduction targets and measures required for transitioning into a low-carbon economy. For information on SBT, please refer to

The typical categories of transition risks and/or opportunities an organisation should consider when applying scenario analysis are summarized in the table below:

Market and Technology Policy and Legal Reputation
As markets respond to climate change, supply and demand will shift for certain products and services. For example, reduced market demand for higher carbon products/commodities, and increased demand for energy-efficient, lower carbon products and services.

Organisations may also be impacted by improvements in technology, including technology that accelerates the transition to a lower-carbon economy. These new technologies will disrupt and displace parts of the current system.

How will these changes impact the financial security of investments? And what should key decision makers do to mitigate these disruptions?

International, national and state level legislations are evolving in response to the need for mitigation of climate change and to catalyse climate change adaptation. Organisations that fail to change are at risk of non-compliance.

For example, there is an increased threat to securing license to operate for high-carbon activities, and an increased risk of legal action against companies that have contributed to the causes of climate change.

Secondly, with the introduction of policies on pricing externalities (e.g. carbon tax), there is also an emerging concern about increased operating costs.

Stakeholders such as investors, lenders, and consumers are increasingly expecting responsible conduct from businesses. Failure to appropriately demonstrate adaptation risks loss of trust and confidence in management.

A client case study

In 2018, Paia Consulting was commissioned by a South East Asian client in the financial sector to conduct focus-group discussions (FGD) with a broad range of stakeholders, including senior management, representatives from all business units, and key external stakeholders.

The objective of the discussion is to solicit feedback from key internal and external stakeholders on the organisation’s sustainability strategy, materiality, and potential focus areas.

As part of the FGD, Paia applied the scenario analysis approach and presented two scenarios highlighting

  • physical risks from a business-as-usual approach, and
  • transition risks from government legislations and policies in meeting the national climate change commitments, i.e. the Intended Nationally Determined Contributions (INDC) under the Paris Agreement.

During the scenario analysis exercise, participants were asked to discuss and identify the effects of the scenario on the organisation, the organisation’s response to improve its resiliency, and initiatives which can be undertaken to achieve a different outcome or to thrive in these changing environments.

As a result of this scenario analysis exercise, participants were able to grasp and consider the multi-faceted ESG risks which can affect their organisation, and suggested potential solutions the company should develop to overcome key ESG risks.

[1] Global Climate Index 2017, Asset Owners Disclosure Project.



3 common hurdles of writing a Sustainability Report

3 common hurdles of writing a Sustainability Report

Complexity can be stressful for anyone so we completely understand what you’re facing when asked to put together a Sustainability Report for your organisation when you simply don’t know how and frankly don’t have the time. The hurdles you face are shared by many and we want to help by addressing these issues and suggest real ways in which you can overcome them.

Challenge #1: Lack of commitment from management towards allocating sufficient time, budget and training to do this task.

Define the ‘Why’ of why you’re putting this report together. Understand what sustainability is and why there is a need for reporting on it. Is it merely to comply with SGX Sustainability Reporting Guidelines or to meet investor needs? Do you need this information to respond to media enquiries? You can improve your company’s reputation by telling the sustainability story of your company. Does the board need to understand the impact of what your company does?

Be sure to define the ‘Why’ clearly. What will be the benefits of reporting? Once upper management is committed, it will pave the way for suitable budget and time allocation, as well as, ensure cooperation from both upper management and colleagues in sharing the metrics required to complete your report.

Challenge #2: Do not have the skills to write this report but need to. Are you concerned that you do not have the pre-requisite knowledge? 

Do you feel like you’ve been thrown in the deep end and you’re scared to mess it up? Our Sustainability Reporting Toolkit Package has been put together just for you by people who have extensive experience in writing sustainability reports and aims to simplify the process for new reporters. The package includes a Handbook which outlines the essential sections of a sustainability report, guiding you on what content to focus upon and where to obtain the relevant information. The package also includes Tools and Templates to help you build the data required to populate the report. This is complemented by a one day training course held within a small group setting allowing our experienced reporter to help you understand how to use the Tools and Templates provided to compile your company’s sustainability report.

Challenge #3: Availability and accuracy of data

Sustainability performance data is required to comply with SGX reporting requirements. Our experts provide pragmatic guidance of how to source the relevant data to do a report. Our Toolkit guides you, step by step through the data collection process so that companies can cost effectively establish a data collection system to go alongside financial data, as these reports are likely to require third party audit in the near future as stated in SGX’s reporting requirements. Hence putting in place a robust data collection system from the very beginning.


Contact us today and lets have a conversation about your sustainability reporting journey. We are here to help.

What else would you like to learn more about? We would love to hear your views so please email your contributions to

What companies in Singapore should know about the Carbon Tax

Singapore has passed the Carbon Pricing Bill on large emitters. Under the 2015 Paris Agreement and as part of a global effort to mitigate climate change, Singapore has pledged to reduce its greenhouse gas emissions per dollar of GDP by 36 per cent from 2005 levels by 2030. It has also pledged to stop any increase in its total GHG emissions by 2030.

The public and private sector, to increase focus on waste reduction

On World Environment Day this year, both the public and private sectors in Singapore upped up their efforts for environmental protection with a series of plans and initiatives. These include:

  • the unveiling of the Public Sector Sustainability Plan 2017-2020 by Deputy Prime Minister Teo Chee Hean,
  • the introduction of mandatory reporting of packaging data and packaging waste reduction plans and the Logo for Products with Reduced Packaging by National Environment Agency,
  • the launch of ReCYCLE, a nationwide electronic waste recycling programme by Singapore Post and Singtel
  • the official opening of the Singapore Sustainability Academy by CDL and Sustainability Energy Association ofSingapore.

Under the Public Sector Sustainability Plan, environmental targets are set with regards to the use of electricity, water, building, waste and solar energy for FY2020 and achieve them through better resource management. Transparency and Disclosure is one of the main components guiding the Plan [1]; we can expect progress against targets to be communicated. The Plan reinforces Singapore’s commitment to the Paris Agreement of reducing emissions intensity by 36 per cent by 2030 from 2005 levels [2].

The Public Sector Sustainability Plan is published by the Ministry of Environment and Water Resources (MEWR), under the Sustainable Singapore campaign.

The National Environment Agency, an agency under MEWR, also introduced initiatives to reduce packaging waste. The launch of the Logo for Products with Reduced Packaging (LPRP) will help inform consumers of products that has reduced packaging and hence generate less waste. Mandatory reporting of packaging data and packaging waste reduction plans will also be introduced by 2021, for businesses that uses packaging on consumer goods [3].

The announcement of mandatory reporting of packaging data and Waste Reduction Plans by 2021 was made by Mr Masagos Zulkifli, Minister for the Environment and Water Resources, during the 10th Anniversary celebrations of the Singapore Packaging Agreement (SPA) [1]. Reduction of packaging waste makes business sense for winners of the 10th SPA awards.  Greenpac for example avoids 4.13 tonnes of packaging material and reaps about $17,200 a year in material cost savings after redesigning a microscope packaging to use lighter polypropylene (PP) corrugated sheets instead of wood [4]. Sunfresh Singapore has estimated annual cost savings of $1,320 with a reduction of 0.28 tonne of plastic packaging waste by eliminating plastic liners in their deliveries of aluminium cups [4].

Given that one-third of about 1.66 million tonnes of waste disposed in 2016 by Singapore was packaging waste [1], these initiatives are appropriate and timely.

Waste reduction was the theme of some initiatives by the private sector as well.

Singapore Post and Singtel for instance launched ReCYCLE, a nationwide electronic waste recycling programme. Consumers can now drop unwanted electronic devices into the ReCYCLE bins at selected Singtel outlets and Post Offices at no charge. Valuable metals and components in the devices would be recovered [5].

At the official opening of the Singapore Sustainability Academy (SSA), winners of the 6th CDL Singapore Sculpture Awards presented artwork that utilised the SSA’s residual building materials, in line with this year’s theme of ‘Towards Zero-Waste!’ [6].

The SSA is a training and networking facility on sustainability jointly created by City Developments Limited (CDL) and the Sustainable Energy Association of Singapore (SEAS), a non-profit organisation. Among other sustainability-related events, the SSA will be a platform for CDL’s Women4Green initiative, the first sustainability network for women in Singapore. The SSA will also partner Eco-Business to set up a Sustainability Studio for the production of sustainability-related films [6].

The ReCYCLE programme and the Singapore Sustainability Academy are great examples of how partnerships between sectors can work together to achieve better environmental outcome. Indeed, that collective effort by all sectors in the economy are required to make progress, and it is heartening to see initiatives by both the public and public sector this World Environment Day.

World Environment Day started in 1974 by the United Nations, and is celebrated on 5 June by over 100 countries every year [7].






[4] Singapore Packaging Agreement, ‘3R Packaging Awards 2016’






human rights workplace

Human Rights in the Workplace

What constitutes Human Rights in the Workplace

Human rights are often seen as perplexing, complex issues that most organisations find hard to grapple with or think these are simply not applicable to their business. Human rights are in fact, very much a part of the daily workings of an organisation. Common human resource issues, contractual agreements, health and safety of employees, discrimination, fair wages – all form part of human rights.

The UN Guiding Principles on Business and Human Rights (or the ‘Guiding Principles’) which is the global standard in this field and endorsed by the UN Human Rights Council[1] defines human rights as being inherent to all individuals – some outlined in the Principles include rights to life and security, rights to freedom of thought, expression and religion, freedom of association and of movement, rights to education and work, to family life and privacy, to food and water, freedoms from torture, slavery or forced labour, rights to freedom of movement, rights to fair and decent work conditions and non-discrimination and rights to a fair trial[2]. The Principles are applicable to all states and businesses and set expectations about how to prevent, address and mitigate negative impacts on human rights by business.

In addition to the Guiding Principles, there are other internationally recognized human rights which Singapore specifically adheres to such as the Universal Declaration on Human Rights, which was adopted by the United Nations, the ILO Declaration on Fundamental Principles and Rights at Work, Convention on the Rights of Persons with Disabilities and the Convention to Eliminate all forms of Discrimination against Women, Convention on the Rights of the Child (CRC).

Why are Human Rights becoming more relevant in the workplace and what are the expectations from companies?

It is evident that companies can preserve or adversely affect human rights of their employees and contract workers, their customers, workers in their supply chains, the local communities in which they operate and the final users of their products and services.

The Guiding Principles make clear that all companies have a responsibility to respect human rights, and the responsibility applies not only to company’s own operations but also to all their business relationships, including those throughout their value chain. The UN Guiding Principle 11 expects companies to ‘avoid infringing on the human rights of others and should address adverse human rights impacts with which they are involved’.

The first Corporate Human Rights Benchmark (CHRB) launched earlier this month benchmarking the human rights performance of 98 of the world’s biggest businesses from the apparel, agriculture and ICT sectors[3]. This study determines global leaders and laggards and is the result of detailed and wide-ranging multi-stakeholder consultations, across a wide range of stakeholders (companies, governments, civil society organisations, academics, legal experts etc.). The tool benchmarks business performance on how well they are doing at embedding the UN guiding principles on business and human rights across 6 main categories: their Governance and policies, evidence of embedding Respect and Human Rights Due Diligence, provision of Remedies and Grievance mechanisms, performance of companies Human Right practices as well as their response to allegations and the transparency of their disclosure. Some of the leading companies that emerged were global brands like Marks and Spencer, H&M, Nestle, Unilever, Total and Adidas to name a few. Surprising for some were BHP Billilton, Rio Tinto and TOTAL raking high points.

The benchmarking exercise, like the Modern Slavery Act (in the UK) is instigating business to reconsider their existing governance practices within their operations as well as their supply chains, and to think hard about what the rights of their stakeholders are. The published report does acknowledge that developing strong and enhanced human rights practices is not something that can happen overnight for companies. It takes time to change practices and mindsets, develop frameworks and policies and embed them into the organisation.

Melanie Yap, Founding Partner of A Very Good Company (AVGC) Singapore, a boutique agency which brings together teams of experts to create and implement programmes that bring financial and social value contends ‘businesses, especially those with a global outlook are aware that they run a very real risk of reputational damage with investors, customers and future talent if they fail to take action to prevent and remedy human rights violations. We have seen in particular, investors and consumers pay increasing attention to supply chains where labour rights and industrial relations pose a risk not just to the reputation of a business but to the business itself.’

In Singapore, companies are beginning to talk about human rights, very much in line with international expectations. We still have a long way to go but it is apparent that are benefits to businesses of respecting human rights such as improved risk management, greater access to business opportunities, positive recognition including being seen as a socially responsible organisation, leading to better reputation and ultimately improved relationships with stakeholders – all leading to the greater trust and transparency. Increasingly, as investors look to non-financial, social and governance performance aspects of companies, companies cannot shy away from addressing these slightly complex issues.


[1] In 2011



Are the GRI G4 Sector Disclosures still relevant?

With the new GRI Standards, using the G4 Sector Disclosures is a ‘reporting requirement’ – a
‘should’, not a ‘reporting requirement’ (GRI 101 Foundations, pg. 18). What does this mean for
Simply put, it is now a recommendation, and not a requirement, that reporting organisations consult
the sector disclosures to assist with identifying its material topics and indicators to report on. To
prepare a report in accordance to GRI Standards, you do not have to consult the sector disclosures,
but Paia recommends that you do. GRI Standards requires that attention be paid to the sustainability
context, which includes the sectoral context. One of the tests of materiality is that it includes “main
topics and future challenges for a sector, as identified by peers and competitors” (GRI 101
Foundations, pg. 18) , suggesting that a sector-specific approach still remains useful.

Sources: GRI 101 Foundations Document, 2016

Before the Flood

Earth Day Film Screening at NUS: Leonardo Dicaprio’s Before the Flood

The NUS Energy Studies Institute (ESI) and the US Embassy jointly organized a screening of the 2016 documentary film about climate change, ‘Before the Flood’, on the 6th of April 2017. Held at the NUS University Hall Auditorium, the film screening was prefaced by a panel discussion on climate change.

‘Before the Flood’ is a powerful documentary, driven by an engaged and empathetic Leonardo DiCaprio. He takes on the role of investigative journalist as he travels across the globe to interview politicians, researchers, innovators – subjects interviewed include former President Barack Obama, Elon Musk and Pope Francis. It is in the linking of multiple places in the world that presents climate change as a multifaceted reality, connecting groups of people in the face of an unrelenting threat. DiCaprio masterfully journeys from the flooded crops in India, to the smog-hit industrialized cities of Beijing, to the melting ice sheets of Greenland, the political impasse of the White House, the magnitude of factory-farming in the US, and even to Hollywood, to explore the effects of climate change. The documentary shows with stunning clarity the different ways in which people are organizing against climate change. In China, DiCaprio is educated on the importance of data, and how grassroots movements have called for more transparency and reporting by companies. This has created momentum for citizen-built data collection and data sharing platforms, providing citizens with leverage to demand accountability from companies and specific policy changes from their government. In the US, DiCaprio sees instead a move towards carbon pricing across the economy, from the private industry through to government legislation.

‘Before the Flood’ is a very visual, educational documentary, focused not just on showing the effects of climate change, but also the ways in which things like data, reporting, innovation and policy can be used to develop short and long term solutions. For more information on the film, please visit:


Charting materiality amongst Singapore’s sustainability reporters

by Carrie Johnson, Wong Dan Chi, Nicolas Heath & Lim Sze Wei

With the Singapore Stock Exchange’s (SGX) announcement this year that sustainability reporting is to be introduced on a “comply-or-explain” basis for all listed companies from the end of FY2017, understanding Environmental, Social and Governance (ESG) material issues has never been more important. Up to 700 companies will soon have to start reporting on their ESG risks and ultimately tackle the all-important question, which is: when it comes to sustainability, what is considered relevant?

This is where the idea of materiality becomes important. Material issues, as defined by the Global Reporting Standards (GRI) are issues “that reflect a reporting organisation’s significant economic, environmental and social impacts”. The process that a company goes through in defining these issues (often termed a ‘materiality assessment’) will form the inevitable backbone of the reporting process for new reporters.[1]

Hundreds of companies are now embarking on the process of assessing their material issues and prioritising risks and opportunities. Paia has, through conducting research, identified the material issues that matter to current sustainability reporters in Singapore.  Which issues stand out, and what processes are companies using to decide on their material issues? Paia attempts to provide insight to this question by analysing the material issues and materiality process of all 40 Singapore companies currently producing sustainability reports to an internationally recognised standard.

What do reporters consider most material?

The majority of Singapore’s reporters have aligned themselves to the guidelines set by the Global Reporting Initiate (GRI). The GRI is the global standard for sustainability reporting, and its materiality determination process often forms the basis of the materiality assessments undertaken by companies.  On the whole, Singapore’s reporters align their material issues with GRI’s predefined topics.  The updated GRI Sustainability Reporting Standards (released in 2016) encourages companies to align their material issues to GRI’s predetermined list, so that companies are reporting on standardised issues, and therefore standardised KPIs. This encourages comparability across companies and their reports. Some companies also include sector specific topics, which are reporting recommendations under the new GRI Standards. This is most prominent among agricultural reporters who tend to prioritise sector-specific issues such as smallholder rights and peatland degradation, making their reports more meaningful in the process.

Paia’s has identified the 6 most reported material issues out of the 40 Singaporean companies, as shown in the following chart:


Top 6 Materiality Sustainability Issues

Note: In identifying the top material issues reported, Paia considered material issues that were ranked as highly important by companies. In the absence of ranking or prioritisation of material issues, all listed material issues were included in the analysis.

From Paia’s analysis, Singapore’s most material issue is ‘Occupational Health & Safety’. It is material to 80% of all GRI reporters. Paia also found that companies that didn’t include this as a key material issue primarily fell into the financial services sector.

Paia also found that even for issues not ranked as a key material issue, companies often still disclosed performance data. For example, companies that did not rank ‘Energy’ or ‘Water’ as key material issues typically still disclosed performance data around these issues, as this practice was seen to be in-line with reporting expectations.

Paia’s analysis also attempted to identify the most reported KPIs. Our results are shown in the table below, indicating the KPIs that were reported on by more than 75% of Singaporean companies:

Training & Education Average hours of training per year per employee by gender, and by employee category LA9 90.0
Training & Education Percentage of employees receiving regular performance and career development reviews, by gender and by employee category LA11 90.0
Energy Energy consumption within the organization EN3 87.5
Economic Performance  Direct economic value generated and distributed EC1 85.0
Occupational Health & Safety  Type of injury and rates of injury, occupational diseases, lost days, and absenteeism, and total number of work-related fatalities, by region and by gender LA6 85.0
Water Total water withdrawal by source EN8 82.5
Employment Total number and rates of new employee hires and employee turnover by age group, gender and region LA1 80.0
Local Communities Percentage of operations with implemented local community engagement, impact assessments, and development programs SO1 77.5
Energy Reduction of energy consumption EN6 75.0
Emissions Energy indirect greenhouse gas (GHG) emissions (Scope 2) EN16 75.0

More than 50%, but less than 75% of Singaporean companies report on the following indicators:

Emissions Reduction of greenhouse gas (GHG) emissions EN19 70.0
Environmental Compliance Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with environmental laws and regulations EN29 70.0
Emissions Direct greenhouse gas (GHG) emissions (Scope 1) EN15 67.5
Diversity and Equal Opportunity Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity LA12 67.5
Anti-Corruption Communication and training on anti-corruption policies and procedures SO4 62.5
Training and Education Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings LA10 62.5
Anti-Corruption Confirmed incidents of corruption and actions taken SO5 60.0
Emissions Greenhouse gas (GHG) emissions intensity EN18 60.0
Occupational Health & Safety Percentage of total workforce represented in formal joint management-worker health and safety committees that help monitor and advise on occupational health and safety programs LA5 60.0
Non-Discrimination Total number of incidents of discrimination and corrective actions taken HR3 60.0
Society Compliance Monetary value of significant fines and total number of non-monetary sanctions for non-compliance with laws and regulations SO8 57.5
Effluents and Waste Total weight of waste by type and disposal method EN23 57.5
Employment  Benefits provided to full-time employees that are not provided to temporary or part-time employees, by significant locations of operation LA2 55.0
Anti-Corruption Total number and percentage of operations assessed for risks related to corruption and the significant risks identified SO3 55.0
Energy  Energy intensity EN5 52.5
Customer Health and Safety Percentage of significant product and service categories for which health and safety impacts are assessed for improvement PR1 52.5
Customer Health and Safety Total number of incidents of non-compliance with regulations and voluntary codes concerning the health and safety impacts of products and services during their life cycle, by type of outcomes PR2 52.5
Effluents and Waste Total water discharge by quality and destination EN22 50.0
Product and Service Labelling  Results of surveys measuring customer satisfaction PR5 50.0

Note: Although the GRI Standards are the most updated version of the sustainability guidelines set out by GRI, Paia’s analysis focused on GRI G4 indicators as most reports prior to 2017 used this standard.


The Materiality Determination process

Material issues essentially represent a company’s key ESG risks and opportunities.  As such, a robust, auditable process should be used to identify which issues are most material. SGX’s reporting guidelines require companies to disclose the process used to determine its material issues. Companies are also required to engage internal and external stakeholders in this process. At present, only 68% of Singapore’s reporters state that stakeholder engagement was a part of their materiality process. Of this, only 7.5% provided meaningful disclosure on how stakeholder engagement informed their chosen material issues.  Paia also discovered that the majority of those who engaged external stakeholders did so through the use of an online survey.

Engaging external stakeholders is crucial in building a relevant sustainability report. If key issues that are considered critical by external stakeholders are not taken account, the validity of these reports can be called into question.  Through our work over the years, Paia has observed that reporters who embrace stakeholder engagement from the outset are more able to produce meaningful reports that address key material issues.

SGX also expects senior management and the Board of Directors to be involved in the materiality assessment process.  At present, only 45% of Singapore’s reporters made reference to senior management being involved in the materiality process.  Senior management teams and Boards of Directors are increasingly playing a vital role in determining the material ESG issues affecting long-term performance.  Paia increasingly observes the materiality assessment process being driven by the CEO or CFO and being reviewed by the Board.  This reflects a significant shift towards sustainability issues being viewed as business risks and opportunities.  Senior management and Board engagement is where we see rapid uptake of global leading practices within companies locally.



As the next generation of Singapore’s sustainability reporters start to release their reports, the materiality landscape will surely change. However, there is much that reporters can learn from the current state of reporting. To reiterate these lessons, we list the main points of our research here:

  • There are topics that will emerge as being material to most companies. Currently, ‘Occupational Health & Safety’ is one such topic.
  • There are reporting expectations that will encourage companies to disclose KPIs on issues that might not be directly material to them – for example, it is standard practice for companies to disclose performance related to energy and water consumption
  • Getting material issues right from the outset is at the crux of meaningful reporting and driving long term performance

We hope that Paia’s analysis has increased your understanding of the materiality determination process, and in particular, the state of reporting on material issues in Singapore.

[1] GRI Standards 101: Foundation 2016 pg. 27


Singapore’s 2019 Carbon Tax…does it matter to you?

Nurul Amillin Hussain.

A carbon tax on emissions of greenhouse gases (GHG) will be implemented in 2019, as announced on the 20th of February in the 2017 Budget, delivered by the Minister of Finance, Heng Swee Keat. This move towards carbon pricing follows other policy initiatives to reduce Singapore’s emissions intensity to 36% below 2005 levels by 2030, a target pledged under the 2015 Paris climate change pact.

This is not the first time the issue of carbon pricing has cropped up in Singapore’s agenda. In the 2016 Climate Action Plan, the Government said that carbon pricing was being studied as a method to enhance energy efficiency across industries.

What is carbon pricing?

Carbon pricing is a market-based method aimed at reducing emissions by charging emitters. The charge imposed on emitters is called a carbon price, which is the amount that must be paid for the right to emit one tonne of carbon dioxide into the atmosphere. There are 2 kinds of carbon pricing – a carbon tax, or cap-and-trade, which allow emitters to purchase permits to emit carbon dioxide.

Using carbon taxation to manage GHG emissions has been a strategy in the stable of environmental regulation for decades. Finland, for example, was the first country in the 1990s to impose a carbon tax. Other countries that have implemented a carbon tax include Zimbabwe, India, Japan, Denmark, Germany, the Netherlands, Norway, Sweden, Switzerland, the UK and Canada. There are also various countries within the Asian region and beyond where the carbon tax has been proposed, but not yet implemented – South Korea, Taiwan, South America, New Zealand and France are some examples. Larger users of carbon resources, such as the United States, Russia and China, have been actively resisting carbon taxation despite growing calls to engage in more market-based solutions to curb GHG emissions.

What does this mean for you?

The carbon tax that the Singapore government aims to implement in 2019 is aimed at curbing GHG emissions upstream, targeting power stations and other large direct emitters, rather than individual, domestic electricity users. The impact of the tax will be more significant in industries that are larger contributors to Singapore’s GHG emissions, such as the manufacturing sector. Making up 59% of total emissions in 2012, the sector has specifically been part of Singapore’s commitments towards reducing emissions, with a target set up to improve energy efficiency in the sector by 1-2% a year from 2020 to 2030.

Carbon pricing systems are a timely addition to larger, multi-lateral plans to reduce GHG emissions and address the pressing issues of climate change. It offers a balanced solution between addressing climate change risks and ensuring economies stay competitive in the long-term. Contact us if you would like to know more about how we can offer our customised help and strategic expertise in this area.


Budget 2017: Sustainable Development for a Resilient Singapore


The 2017 budget which was announced by Singapore Finance Minister Heng Swee Keat outlined initiatives to boost sustainable growth and productivity amidst global political and economic uncertainties

Here are some key sustainability-related points from the Budget Statement:


  1. Plans to help companies manage economic transition
  • In view of continued weakness, the Government will defer foreign worker levy increases in Marine and Process sectors by one more year
  • Increase in wage and training support for workers moving to different sector under Adapt and Grow initiative
  • New Attach and Train initiative for up-and-coming sectors to provide work and training attachments


  1. Support for companies hiring older workers
  • The Special Employment Credit which provide employers with support for the wages of older workers will be extended till end-2019.
  • MOM will raise the re-employment age from 65 to 67 years, with effect from 01 July 2017
  • Employers will get wage offsets of up to 3% for workers who earn under S$4,000 per month and who are not covered by the new re-employment age of 67


  1. Carbon tax on the emission of greenhouse gases to be implemented from 2019
  • To curb emissions of greenhouse gases, the tax will be applied upstream, on power stations and other large direct emitters, rather than electricity users
  • The government is looking at a tax rate of between $10 and $20 per tonne of greenhouse gas emissions
  • Revenue from the carbon tax will help to fund measures by industries to reduce emissions


  1. Restructuring diesel tax
  • Introduce a volume-based duty at $0.10 per litre on automotive diesel, industrial diesel and the diesel component in biodiesel
  • Permanently reduce the annual Special Tax on diesel cars and taxis by $100 and $850 respectively


  1. Current Carbon Emissions-based Vehicle Scheme (CEVS) will be replaced with a new scheme that would consider four other pollutants on top of carbon dioxide
  • The new Vehicular Emissions Scheme (VES) would include nitrogen oxides, hydrocarbons, particulate matter, and carbon monoxide to account more holistically for the health and environmental impact of vehicular emissions
  • The new VES would run for two years starting from 1 January 2018. Meanwhile, the current CEVS would be extended until 31 December 2017


  1. Water prices, which was last revised in 2000, will increase by 30% in two phases starting from 1 July 2017
  • When increase is fully phased in July 2018, increase in monthly water bills will be less than S$18/month for 75% of households while increase will be less than S$25/month for 75% of businesses
  • Lower income households to get help to manage increases in household costs



  1. Support for families
  • CPF housing grant increased from $30,000 to $50,000 for couples who purchase 4-room or smaller resale flats, and from $30,000 to $40,000 for couples who purchase 5-room or bigger resale flats.
  • Capacity for centre-based infant care will be increased to more than 8,000 places by 2020
  • Increase in annual bursaries for post-secondary students, and revision in income eligibility criteria for such bursaries to extend them to more families


  1. Support for people with disabilities and those with mental health conditions
  • Government expects to spend around S$400 million per year on initiatives supporting persons with disabilities
  • The government will launch the third Enabling Masterplan, to better integrate Persons with Disabilities into the workforce, and to give more support to their caregivers
  • The government will spend an additional S$160 million on community mental health efforts
  • A Disability Caregiver Support Centre will also be set up to provide caregiver training and peer support
  • The number of Dementia Friendly Communities will also be expanded


  1. More support for community sports and sports excellence
  • More than S$50 million has been set aside to support community sports
  • The Sports-in-Precinct Programme will be expanded so that more Singaporeans can play sports near their home
  • The SportCares programme, which encourages disadvantaged youth to discover their strengths through sports, will also be expanded
  • The Government will commit an additional S$50 million in grants over the next five years to help aspiring athletes reach their full potential


Source: Budget Speech 2017, published on 20 February 2017 by the Singapore Government

sgx sustainability reporting workshop

SGX offers companies subsidised sustainability reporting workshops

Paia will be running the following SGX subsidised workshops primarily focused to assist Singapore Exchange (SGX) listed companies to meet the new requirements.

Carrie Johnson, Director of Paia Consulting, said,

“It is great that SGX has appointed GCNS to organise the workshops which will encourage companies to start reporting early. Having helped SGX-listed companies on sustainability reporting for over a decade, early starters are more likely to gain from the business opportunities that sustainability management can bring.”

Industrials – Transportation on 27/02/2017 @ 9:00am Ended

Industrials – Commercial & Professional Services on 27/02/2017 @ 9:00am Ended

Industrials – Capital Goods on 27/02/2017 @9:00am Ended


Industrials – Capital Goods on 13/03/2017 @ 9:00am

Industrials – Commercial & Professional Services on 13/03/2017 @ 9:00am

Industrials – Transportation on 13/03/2017 @ 9:00am

Consumer Discretionary on 20/03/2017

Consumer Staples on 22/03/2017 @ 9:00am


CDP … just another sustainability acronym, or worth my time?

The Carbon Disclosure Project (CDP) is currently publishing the 2016 results of its climate change, forest, water and supply chain surveys, having started with the UK results end of October. Soon, some Singaporean companies will get scores, some will be publicly named as not responding, others won’t be mentioned. Should you care?

CDP runs a global disclosure system for investors, companies and policy makers to manage their environmental impacts. They praise themselves to have built “the most comprehensive collection of self-reported environmental data in the world”, and many agree on that. Investor analysts draw a lot of their information from CDP’s database, with CDP’s network representing over US$100 trillion. CDP itself chooses the companies for its surveys; in addition, you can volunteer to participate for a fee.

Thus… next time your company receives a CDP questionnaire, you might want to consider responding to it, at least partially. Keep a lookout in May each year, to meet their deadline end of June for the Climate change, forests and water programs, end of July for the supply chain program.

If you are already participating, make sure you are familiar with the updated scoring approach for climate change. CDP has changed its methodology in 2016, putting more emphasis on materiality assessment, management (actions, policies and strategies to address environmental issues), governance and leadership. CDP also recognises your target for the reduction of greenhouse gas emissions, provided it is aligned with global emissions budgets, i.e. for Singapore with the Government’s climate action plan – a criteria you should keep in mind while developing targets as required by SGX. Also, be prepared that CDP will introduce sector-based questionnaires in Q4 2017. CDP hopes to enable better peer-to-peer comparison and benchmarking.

If you want to learn more about CDP, read here, register for Paia’s Sustainability Reporting training, or contact us so that we can offer our customised help.

cdl asia top property developer

Our client CDL, Top Property Developer Top Singapore Corporation

Congratulations to our client, City Developments Limited (CDL) for being named the Top Property Developer in Asia and Top Singapore Corporation, for the third year running.

CDL is now in the 2nd spot in the list of top 100 most sustainable companies in Asia. It is also the only Singapore company and property developer in the top 20 list for 2016.  CDL is the only Singapore company to have made it to the top 10 list for three consecutive years since the inception of Channel NewsAsia Sustainability Ranking in 2014. The Ranking highlights the overall top 20 companies and the top three businesses per country. It provides investors and consumers insights into corporate sustainability practices, and enables companies to benchmark their sustainability performance against other regional businesses.

Mr Grant Kelley, CDL Chief Executive Officer said, “Sustainability is fast becoming mainstream in today’s global business environment. CDL has always been a firm proponent of integrating sustainability into our corporate vision and business strategy. This has created long-term value not only for CDL, but also our investors, customers, the broader community and the environment. CDL will continue to push forward with sustainable innovations and practices across our operations and supply chain. With the rise of green consumerism and global expansion of Socially Responsible Investment Funds, we believe our sustainability commitment will enable us to tap more growth opportunities ahead.”

CDL has spearheaded numerous groundbreaking innovations in green properties, including the first CarbonNeutral® development in Asia Pacific and Singapore, 11 Tampines Concourse; Singapore’s first Eco-mall, City Square Mall; and Tree House condominium, which achieved a Guinness World Record for the largest vertical garden.

As shared in its 2016 Integrated Sustainability Report titled ‘Integrating our Strengths, Creating Future Value’, CDL has also introduced robust targets for reduction in energy and water use. These new targets are in addition to CDL’s carbon emissions intensity3 reduction targets set in 2011 – 22% by 2020 and 25% by 2030, from baseline year 2007.

In 2016, CDL further took the lead as one of the first Singapore companies to align its material issues to the United Nations (UN) Sustainable Development Goals (SDGs) launched in September
2015. The SDGs are expected to form a global standard that will inform future policy decisions and legislation by governments. Businesses that support the SDGs are thus more likely to be aligned
with emerging policy priorities, potentially enhancing their licence to operate.

CSR and Social Innovators Forum 2016

The Paia team attended the CSR and Social Innovators Forum (CSRSIF) held at Suntec Convention and Exhibition Centre, 1-2 September 2016. The first joint event between Global Compact Network Singapore (GCNS) and Social Innovation Park Ltd (SIP), the CSRSIF combines the fields of corporate social responsibility and social innovation with the theme “Co-creating the Future Economy through Sustainability and Innovation”.

Day one of the forum was opened by Mr Ho Ming Kiat, Vice President of GCNS, Ms Penny Low, Founder and President of Social Innovation Park, and guest-of-honour Mr Tharman Shanmugaratnam, Deputy Prime Minister and Coordinating Minister for Economic and Social Policies. DPM Shanmugaratnam recognized the importance of ground-up initiatives in shaping intrinsic motivations. He also emphasised that while not every company has a social mission, every employer can be an inclusive employer. In response to a question from the floor on how ground-up initiatives can better partner with traditional businesses, Singapore Business Federation was identified as the intermediary to create networks for such partnerships.

Plenaries that followed had high-profile speakers from corporations, non-profit organisations, and the investment community, including Mr. Oscar Wezenbeek, Managing Director of AkzoNobel Marine Coatings, Prof. Simon Zadek, Co-Director of the Inquiry into Design Options for a Sustainable Financial System, UNEP, and Ms Yeo Lian Sim, Senior Advisor of the Singapore Exchange (SGX). They shared insights on how CSR and innovation are opportunities and adaptive measures to risks and destabilizing forces, and how collaborations can help fill gaps found in each sector. Dr. Parag Khanna, Co-Founder and Director of Hybrid Reality Institute, is an advocate of the co-creation model, and he shared how hybrid structures could strengthen the capabilities of governments.

Day two of the forum was equally engaging, with Ms Grace Fu, Minister of Culture, Community and Youth as the guest-of-honour. Ms Fu emphasized the government’s support in strengthening the social compact, including a tax deduction scheme when companies engage in volunteer work. Apart from plenaries by sector experts, delegates also had the opportunity to participate in masterclasses in smaller, more intimate group settings and interactive breakout sessions. The session ‘Design Thinking & System Change: Turning Food Waste to Gold’ led by the Strate School of Design for instance took participants through a systematic brainstorming process that generated more 6 different solutions to food wastage in 90 minutes. The closing plenary ‘Smart Nation: Top Social Innovations Changing Our World’ continued to draw many questions from the delegates – indeed, the questioning will continue beyond the forum.

The CSRSIF definitely highlighted each sector’s role in the areas of CSR and innovation, and the importance of collaborations in driving them. The right policies and regulations, from the government and from the investment community such as the SGX, can drive innovation, while initiatives from the ground and from social enterprises make the change happen. The youth was repeatedly identified as a significant player in the scene – as consumers and employees with high sustainability awareness and drive for change, we are hopeful about the future of CSR and innovation.

Maritime and Port Authority

MPA to co-fund SGX-listed maritime companies sustainability reporting

Maritime and Port Authority of Singapore (MPA) organised a Maritime Sustainability Workshop in M Hotel on Monday 22nd August 2016 where Paia was proud to showcase its work. The purpose of the workshop was to assist and encourage the maritime sector to embrace the new SGX requirement for Sustainability Reporting. SGX’s new sustainability reporting rules require listed companies to publish sustainability reports. Ms Yvonne Chan, MPA’s Director of Corporate Development and Chief Financial Officer, announced a new co-funding initiative to assist SGX-listed maritime companies in Singapore with the production of their Sustainability Report.

MPA will co-fund 50% of the qualifying costs, up to a cap of $50,000 per company.  The funding to the first 10 approved applications is on a reimbursement basis.

Mr Andrew Tan, Chief Executive of MPA, said, “MPA is the first local maritime organisation to publish both an Integrated Report and Sustainability Report last year, and we hope to encourage the rest of the maritime industry to adopt the best practices and mitigate any risks to the environment arising from their operations. The so-called triple bottomline – people, planet and profits – will enhance their shareholder value.”

Source: Maritime and Port Authority of Singapore encourages SGX-listed maritime companies to adopt Sustainability/Integrated Reporting


CDL and SEAS launch the Singapore Sustainability Academy

City Developments Limited (CDL) and the Sustainable Energy Association of Singapore (SEAS) announced the launch of the Singapore Sustainability Academy (SSA) on Friday, 5th August 2016. It is the first major People, Public and Private (3P) ground-up initiative in support of the national goals to tackle climate change articulated in the Sustainable Singapore Blueprint and recently-released Climate Action Plan.

The SSA aims to promote a low-carbon economy, resource efficiency, and sustainable practices among businesses and the community, in particular, youths. It will focus on the key areas of advocacy, building capacity and collaboration, education and training, information and resource as well as user engagement.

The 4,300 square feet academy will be the first in Singapore to have its construction materials, Cross Laminated Timber (CLT) and Glued Laminated Timber (Glulam) verified by the Nature’s Barcode TM system as coming from responsible sources. This entails scientific tests like DNA analysis, to reduce the risk that the wood comes from illegal logging.

Supported by the Ministry of the Environment and Water Resources, the National Environment Agency, the Urban Redevelopment Authority and the Building and Construction Authority, this timely initiative is aligned with Singapore’s efforts to address climate change. Ahead of the Paris Agreement adopted in December 2015, Singapore has pledged to reduce its greenhouse gas emissions intensity by 36% compared to 2005 levels by 2030.

Dr Amy Khor, Senior Minister of State, Ministry of the Environment and Water Resources, said, “There is tremendous potential for the private sector to play a major role in our journey towards mitigating and adapting to the devastating effects of climate change. The Singapore Sustainability Academy by CDL and SEAS is an excellent 3P ground-up initiative in the push forward to become a more sustainable Singapore.”

SGX Briefings for CEOs on Sustainability Reporting

SGX has recently introduced sustainability reporting by listed companies on a ‘comply or explain’ basis in response to growing international interest in sustainability. SGX is inviting CEOs of all SGX listed companies to a 2 hour briefing for clarity and understanding of the new requirement. The briefing will convey the purpose and meaning of SGX’s sustainability requirements, the essentials of a good report from a sustainability consultant and practical advice from a company with reporting experience. Sessions will be held at 9am on the morning of 11, 18 and 25 Aug 2016.

A slice of SGX Reporting for Breakfast at Paia

Paia held a Breakfast Briefing, July 15th to help Singaporean corporate reporters on their journey to producing meaningful, useful and compliant sustainability reports.

Paia Associate Director, Alex Nichols and Principal Consultant, Ms Wong Dan Chi gave us valuable insights and recommendations on how to build a good sustainability report and meet the new requirements of SGX’s Sustainability Guide.

The group of twenty breakfasting participants discussed why companies report and how embarking on a sustainability journey can lead to opportunities and benefits for a company. Paia’s experience is that companies always benefit from the ‘act’ of reporting, particularly the process of prioritising the issues to report on – i.e., the “materiality process”. Doing this well – with the involvement of top management – can lead to better employee engagement, knitting the teams together. It can improve relationships with external stakeholders such as customers, suppliers and investors. This can benefit the company business model – creating and protecting value.

Wong Dan Chi, took us through what to expect in practice from SGX requirements: the nuts and bolts of dealing with the 711A/B rule and how to organise your sustainability report. An example we discussed was about targets for each material issue and how to report SGX-compliant targets (they can be qualitative at first). We also discussed how to measure the opinion of external stakeholders and resolved that a simple approach will be sufficient at first, with depth and wider application of it as a business technique later in your sustainability journey. Other discussions looked at practicalities of whether a physical report is required, or whether a standalone report is required (no, and no).

Paia’s Sustainability Reporting Toolkit-Training package is for companies who wish write their report in-house. We have worked hard to generate a way for companies to learn intensively what they need to do in practice to meet SGX requirements for mandatory sustainability reporting (and beyond). A one-day training is complemented by a Handbook specially developed for training participants, along with bespoke Excel-based tools and a Sustainability Report Sample Tool.

Are you an new reporter (large, medium or small) requiring help with sustainability reporting? Please contact us at for more on our “Sustainability Report Toolkit”.

Transition to GRI Standards

The GRI G4 Reporting Guidelines are on their way to becoming a ‘Standards’ for reports published from January 2018 onwards. Our Senior Consultant Saskia Jung attended the 5th Global GRI Conference in May this year and was able to provide early feedback on drafts of the standards, which will be finalised in October 2016.

The G4 guidelines are in transition mode to becoming ‘Standards’, and although this can sound daunting, it really is not. The main content and concepts have been carried over. One of the biggest changes is that the Standards will be modular and evolving, i.e. new topics or clarifications will be added to the existing ones more easily, without introducing a complete new version (that is why these are ‘Standards’ and not ‘G5’). The guidance has overall been strengthened, many changes are structural with some content from G4 being relocated or merged, to make it easier to find and navigate. The merging has resulted in the total number of topics being brought down from 46 to 33.

There are currently 33 topic-specific Standards drafts, organized in three series: a) Economic topics (400 series) – this includes the G4 Aspects from the Economic Category, plus Anti-corruption and Anti-competitive behaviour b) Environmental topics (500 Series) – this includes most G4 Aspects from the Environmental Category c) Social topics (600 Series) – this includes most G4 Aspects from the Social Category. The sub-categories under Environment, Health and Social have been removed.

There are changes in terminology, format and presentation, ultimately improving clarity to make these easier to understand and apply. For terminology for example, each standard will now be called an SRS (Sustainability Reporting Standard), previous ‘Aspects’ are now called ‘Topics’, ‘Shall’ means mandatory instructions i.e. the company is required to disclose to be in accordance, ‘Should’ means it is advised to disclose but it is not a requirement, and ‘Guidance’ means additional, helpful information.

What are the main changes and how will they affect you as a reporting company? If you are already a G4 reporter, the changes are limited.

  1. Companies have to apply all Reporting Principles (previously covered in G4-18) and comply with all applicable reporting requirements;
  2. The main elements of materiality remain the same as the centre piece of a company’s sustainability report, as they were in G4;
  3. Emphasis on the management approach (previously called DMA) has been taken further, for each material topic, the purpose of the management approach has to be reported, and a description of each of the components used to manage the topic (e.g., policies, specific actions);
  4. Boundary: This topic has been further clarified, so that topic ‘Boundary’ relates to a description of which entities cause the impact related to a material topic, wherever the impact occurs, and not just whether the impacts occur inside or outside of the organisation. Simply put, companies are required to disclose material impacts along their entire value chain.
  5. Impacts: this term has been clarified, and in the context of the GRI Standards, unless otherwise stated, ‘impact’ refers to an organization’s impact on the economy, the environment, and/or society – in other words, the organization’s contribution (positive or negative) to sustainable development.
  6. GHG Emissions: The details on how to report Energy Indirect (Scope 2) GHG Emissions have been specified.
  7. Worker / Employee: clarification for this term has been provided. Any indicators referring to workers should not only include employees, but also interns, apprentices, self-employed persons, and in general persons working for the organizations.

Some items have been moved around in where they are placed. A few Aspects have been merged (e.g. SRS 614: Supplier social assessment combines the three assessments for labour, human rights and society). Some disclosures have been relocated or combined (e.g. G4-57 and G4-58 on ethics and integrity have been combined). Some Aspects have been discontinued, with their content incorporated elsewhere (e.g. Transport).

Sector Disclosures are still very much there to supplement the GRI Standards, but in the new Standards they are referenced as guidance, not as a requirement. And the GRI Content Index is more outcome based and is no longer required in a particular format such as a table. It can also be put online, apart from the printed report.

We have managed to outline the major changes for you to give you a flavour of what is to come. Let us know if you want to know more. And stay tuned – we will update you when the Standards are confirmed, and any important news till then.

SGX launches Comply or Explain Sustainability Reporting

SINGAPORE Exchange (SGX) has officially released the Guidelines and Rule on Sustainability Reporting yesterday, June 20 2016.  These guidelines are in line with the global trend of stock exchanges requiring companies to report on their environmental, social and governance (ESG) issues for financial year 2017. The SGX guidelines expect that companies ‘comply’ or ‘explain’, that is, commit themselves to producing an annual guidance on environmental, social and governance (ESG) in the form of a sustainability report, or ‘explain’ why they are not doing so.

It is important to know that globally, twenty stock exchanges have already committed to producing a guidance for listed companies on ESG disclosures as part of the Sustainable Stock Exchanges Initiative (SSE). This required all stock exchanges that are members of the SSE and the World Federation of Exchanges (WFE) to provide listed companies with guidance on sustainability reporting by the end of 2016.  SGX has supported this initiative like many others and sees the introduction of these “Comply or Explain” guidelines for companies listed on their exchange, as a necessary step towards ESG and sustainability reporting so that companies can improve their communication with investors, analysts and stakeholders.

Getting non-financial information about a company has been difficult for investors. The main aim of these requirements is to provide a more complete profile of a company for investors and stakeholders. If your company wants to embark on your sustainability reporting journey, you may find Paia’s Sustainability Reporting Toolkit  that we are rolling out to simplify the reporting process specifically for SMEs. This Toolkit provides SMEs with the necessary tools to produce a sustainability report in line with SGX’s requirements.

Paia is also rolling out training sessions and workshops catered to companies wishing to produce quality sustainability reports. For more details, please visit our Training page

SMRT Sustainability Report

Our client SMRT publishes their inaugural Sustainability Report

Congratulations to our client SMRT Corporation Ltd (SMRT) for publishing their inaugural Sustainability Report. The Road to a Sustainable Future shows how sustainability is integral to SMRT’s business.

SMRT Sustainability Report

We are pleased to see an increase in sustainability disclosure by Singapore companies.

Strategy and Reporting Services

Start my next Sustainability Report now??

We thought hard before posting this – it sounds a bit like shameless business development when we advise businesses to start reporting early. And 10 months early, too?!

But, allow me to forge ahead!

The dust has barely settled on the last report and it’s time to begin planning the next. Why?

  1. Engage your colleagues. Starting early will reduce the headaches from colleagues claiming they were not aware of what was expected of them. Data and information collection is a big part of the Content Management stages of a Sustainability Report.A big enemy in the Reporting battlefield is uncooperative colleagues. Just when you thought that data was secured and on its way, the contact over in HR says the new Enterprise Management Software sprang a leak and they need to re-do it.Just when you thought you could talk about that supply chain initiative as a core part of a section in your report, the legal team pipe up that it’s embargoed for a legal reason.If you align with the Annual Report calendar then you will be pleased if your timeline is relaxed, rather than squeezed. If you get squeezed later in the project then your families and consultants will be affected too! Best avoided!

    Keeping the internal network alive is a real boon to reporting. Better cooperation, better content.

  1. Enough time to do materiality. Most reporters are by now bruised by the ‘materiality stick’ wielded by consultants around the world. It’s not without good reason though. Applying this core principle of reporting is vital to an effective Report delivered in line with target audience expectations.Don’t forget all you SGX listed companies in Singapore: you will need to explain how you came up with the list of relevant issues to talk about in your Report.
  1. Save costs. I would say that wouldn’t I!? Well, the logical outcome from doing materiality well is normally a shorter report. That saves resources internally – who wants to waste time organising data for a report when it’s not relevant? You may still collect it internally because you’re managing the issue internally – but it may not be sufficiently ‘material’ to be covered in the sustainability report.Being organised in what you want to achieve with the report, what content you expect, how many words it will be etc., will mean clarity in resourcing. Failing to plan is planning to fail (my old lecturer used to say).
  1. Content management. Again, sequentially and logically, once you know the key relevant subjects (or ‘topics’ in new GRI-speak) you will want to talk to the colleagues you have communicated with (see above).Check who is on maternity leave, or on holiday. See if any staffing changes are on the horizon. What about assets – any changes to think about in terms of company structure or operational assets?As scrutiny increases of supply chain management practices, you may need to think through how to collect management approach information on slightly newer issues of interest.
  1. Sort imagery. A report with a staid and tired look using repeated photography will lose credibility. Readers are human and they like to be inspired to open your report when the alternative is catching up with the latest fast cars on YouTube or kiddy bargains on Ebay.So, by embarking early you can knock off a few of those slightly fiddly design tasks. Check in with marketing and communications colleagues about any new developments in branding at your company.Sorting the design early will mean your Report will work harder for you – you will feel enamoured by it and want to take it with you wherever you go. The romance will blossom and you will feel that you and your Report will go far!

Ok, good luck, and you know where we are if you need any help!

New trends in sustainability from the 5th GRI Global Conference, 18 to 20 May 2016

These are some of the newest developments and challenges in sustainability worldwide discussed at the 5th GRI Global Conference, 18 to 20 May 2016 in Amsterdam, The Netherlands. Paia participated in this conference with more than 200 speakers and 1162 attendants from 73 countries – involving representatives from the Global Reporting Initiative GRI, the United Nations (UN Global Compact, UNEP, UNCTAD), many governments and stock exchanges including NASDAQ, investors associations and analysts such as Bloomberg and MSCI, in addition to hundreds of companies from all sectors, associations and academics.

  • More regulation for sustainability reporting is a global trend, with 23 governments or stock exchanges putting regulation in place by end of 2016, on top of the existing 15 requirements. Among them is the Directive 2014/95/EU which will require non-financial disclosure by companies of public interest with more than 500 employees in the European Union, and of course the SGX Guideline, asking all listed companies to comply or explain from financial year 2017 onwards. Two thirds of the members of the World Federation of (Stock) Exchanges’ sustainability working group come from emerging markets.
  • More and more companies manage to embed their material issues in their corporate strategy. The materiality assessment is not done for external stakeholders and reporting purposes, but part of internal strategy development. Paia, who is part of GRI’s GOLD Community, was invited to moderate at a Roundtable on Materiality which discussed how to make materiality analyses more effective.
  • As IT improves, “big data” becomes easier to collect. The challenge is how to systematise it and use it efficiently. The conference also offered insights in newest software solutions for EHS data management.
  • GRI is calling for a “new era of collaboration”, with a special focus on technology and innovation over the next five years. It will continue to ask companies to extend their sustainability practices beyond their own borders – reaching out to their supply chain as well as all finding new partners in the public, private or community sector.
  • GRI also announced its newest technology initiative, the Digital Reporting Alliance. The Alliance will address the lack of structured data and the lack of demand for digital reporting.
  • Regardless of using the term “Corporate Social Responsibility (CSR), to Sustainability, EHS, ESG, and now new expressions such as “quality of life”, the discussion focussed on how to make “the S word” deliver to solve word-scale challenges. The United Nations expects companies to be the principle driver in achieving the Sustainable Development Goals (SDGs).
  • Experts and practitioners worked together to further develop sustainability standards and frameworks as well as Sustainability Assurance, including GRI’s transition from G4 Guidelines to Sustainability Reporting Standards (stay tuned with Paia to learn more soon!), Integrated Reporting and new ISO standards (e.g. ISO 45001 on safety).
  • Trust and Transparency for building better businesses, stronger economies and a more sustainable world was the theme of the closing plenary of the conference. “Delivering a better future is not just an option, it’s a necessity. There is no Plan B,” urged Lise Kingo, Executive Director, UN Global Compact.

Paia’s Senior consultant Saskia Jung was one of only five representatives from Singapore.

Follow us for more updates via Twitter and LinkedIn.

Follow @PaiaConsulting for latest developments at GRI2016 through our Twitter account

Our Senior Consultant, Saskia Jung is at the GRI Global Conference 2016 on Sustainability and Reporting in Amsterdam, The Netherlands. Follow @PaiaConsulting to stay upto date with her tweets.

paia gresb training partner

Paia the exclusive training partner for GRESB in Asia (ex-Japan)

Paia is pleased to announce that it is the exclusive training partner in Asia (ex-Japan) and a Premier Partner of GRESB, the global standard for sustainability assessment of real estate portfolios and infrastructure assets.

“We are excited about our partnership with Paia. We look forward to tap into Paia’s unparalleled experience in sustainability within the real estate sector in this region.”
– Ruben Langbroek, Head of Asia Pacific, GRESB

GRESB’s Real Estate Assessment is widely recognized as the leading benchmarking initiative in the real estate sector.

GRESB is an industry-driven organization committed to assessing the Environmental, Social and Governance (ESG) performance of real assets around the globe, including real estate portfolios (public, private and direct). On behalf of more than 60 institutional investors, GRESB has assessed more than 1,000 property companies and funds globally.

Participation in the GRESB Real Estate Assessment provides companies and fund managers with an opportunity to both measure sustainability performance and also benchmark their portfolio against industry peers. Thus, they are better able to optimise the position of their portfolio in the face of ever increasing market volatility. Participation is free.

“The GRESB Scorecard made available to all participants – for free – serves as a critical input for companies in assessing their strategy. Through the trainings, we want to help funds and companies in the region become more resilient, and find value-creating opportunities.”
– Carrie Johnson, Director, Paia Consulting

Currently GRESB offers two training programs:
Participant Training, where delegates learn to assess and enhance their current performance, to more efficiently prepare their GRESB response, and to improve the quality of their submission.
Investor & Analyst Training, which focuses on ESG integration in real estate investment decision-making and applying GRESB data and tools to assess and improve portfolio performance.

For more information on GRESB Training, click here

GRI introduces a new report review service!

GRI introduces a new report review service! Contact GRI GOLD Community by 10 May 2016 to analyse your published sustainability report & suggest improvements!

Congratulations to our clients CDL, ComfortDelGro, Fraser Centrepoint, FCT, FCOT, FHT, IndoAgri, Keppel TT, MPA, Sembcorp Industries, Sembcorp Marine, ST Engineering on the recent release of their Sustainability Reports

We are pleased to see not only a growth in the number of companies producing GRI Sustainability Reports in Singapore, but also a significant increase in the quality of disclosure. We are proud to have worked with the below companies on their recent reporting projects many of whom have demonstrated leading edge practices in their disclosures.

City Developments Limited (CDL)

ComfortDelGro Corporation Ltd

Frasers Centrepoint Trust

Frasers Commercial Trust

Frasers Centrepoint Ltd

Frasers Hospitality Trust

Indofood Agri Resources Ltd

Keppel Telecommunications and Transportation Ltd (Keppel T&T)

Maritime and Port Authority of Singapore (MPA)

Sembcorp Industries Ltd

Sembcorp Marine Ltd

Singapore Technologies Engineering Ltd

NUS’s CGIO and ASEAN CSR Network look into Sustainability Reporting in ASEAN

On the 25th of February 2016, Paia’s Principal Consultant, Wong Dan Chi was invited as an industry panellist to comment on a report led by the Centre for Governance, Institutions and Organisations (CGIO) at National University of Singapore (NUS) Business School.

Paia is pleased to support research efforts on sustainability and governance, and is especially heartened to see the enthusiastic involvement of the student teams involved.

In 2015, CGIO was commissioned by ASEAN CSR Network to study on sustainability reporting in Indonesia, Malaysia, Singapore and Thailand. The research project, led by Associate Professor Lawrence Loh, Director of CGIO, is carried out by some 20 students from the BBA Honours programme.

At the event, five teams of BBA Honours students from the NUS shared their findings about the scope of reporting and levels of disclosure found in the 3 countries. The students did this by studying the top listed companies from each country, and assessed them by comparing levels of disclosures found in their respective sustainability reports according to the Global Reporting Initiative’s framework.

Along with industry experts including corporate leaders such like Singtel, Keppel Land, and CDL, Dan Chi, provided critique and assessments of the teams’ conclusions and recommendations. The dialogue and feedback broadened the conversation around sustainability in the region and leave with a better understanding of the state of sustainability reporting in ASEAN countries.

The report will be reviewed and launched during the Conference on Corporate Governance and Responsibility in July this year.

More information is available on the university blog:
CGIO presents update on its Sustainability Reporting project

Global 100 Most Sustainable Corporations

Congratulations CDL, Top Sustainable Real Estate company in the world

Congratulations to our client City Developments Limited (CDL) for being ranked the Top Real Estate Company and Top 10 Corporations in the prestigious Global 100 Most Sustainable Corporations in the World in 2016.

SGX releases Consultation Paper on Sustainability Reporting

The Singapore Exchange (SGX) released a consultation paper, ‘Sustainability Reporting: Comply or Explain’ on 5 Jan 2016. In the consultation paper, SGX provides a background and reasons for sustainability reporting, before putting forward amendments to both mainboard and catalist rules, and reporting guidelines. The proposed amendments and the guidelines will be open for public comment until 5 Feb 2016.

The primary components proposed to be included in sustainability reports are:

  1. Environmental, social and governance (ESG) factors material to the company,
  2. Policies, practices and performance of the company in relation to each material ESG factors,
  3. Targets for the forthcoming year,
  4. The Sustainability Reporting Framework used, and
  5. A Board Statement confirming compliance with SGX’s guidelines or explaining incompliance

The guidelines also provide some flexibility to companies. A phased approach for implementation of sustainability reporting is recommended, such that newly reporting companies are given time to ensure that their sustainability disclosures have quality and depth. Companies are also not expected to provide independent assurance of their reports in the early stages.

SGX is also seeking feedback for the inclusion of Anti-corruption and Diversity as part of the primary components. Other features awaiting comment include matters relating to stakeholder engagement, materiality, responsibilities of the board, and frequency of reporting. For the latter, SGX proposes that reports be published annually, within 5 months after the end of each financial year. All listed companies will begin sustainability reporting for any financial year ending on or after 31 December 2017.

In line with SGX’s Guidelines, Paia is rolling out a Toolkit to simplify the reporting process specifically for SMEs. This Toolkit provides SMEs with the necessary tools to produce a sustainability report in line with SGX’s requirements. Read more about it here.


More information about the consultation paper:

  • Business Times, “Designing a sustainability reporting regime”, 6 Jan 2016
  • Business Times,“SGX offers flexibility in proposed sustainability reporting rules”, 6 Jan 2016
  • The Straits Times, “SGX to seek feedback for sustainability report guidelines”, 5 Jan 2016
  • Channel News Asia, “SGX seeks public feedback on proposed rules for sustainability reporting”, 5 Jan 2016

Paia rolls out Toolkit for companies who want to publish sustainability reports in-house.


In line with SGX’s Guidelines requiring listed companies to produce sustainability reports, Paia is rolling out a Toolkit to simplify the reporting process specifically for companies who want to write their report in-house. This Toolkit provides the necessary tools to produce a sustainability report in line with SGX’s requirements.

What you will learn

Paia’s toolkit includes a five-stage approach in fulfilling the company’s requirements in sustainability reporting:


Stage 1 Stage 2 Stage 3 Stage 4 Stage 5
Gap Analysis & Sustainability Strategy Materiality Assessment & Stakeholder Engagement Data Collection & Compilation Drafting of first sustainability report Project Review & Recommendations



For more information, please contact Paia at 3157 6033 or send us an email at
Download the Paia  Toolkit brochure here.

Benefits from reporting, based on testimonials from over 400 SMEs [1]:


1. Develop vision and strategy on sustainability

During the reporting process, you are able to identify a link between the implementation of the reporting process and your strategic development.


2. Improve management systems, internal processes and set goals

A key benefit of the reporting process is that it allows your company to track progress and highlight areas needing improvement, so that you can manage what you measure and make changes where necessary.


3. Identify strengths & weaknesses

The reporting process provides early warning of trouble spots – and shows up unexpected opportunities. These discoveries can help your company’s management to evaluate potentially damaging developments before they emerge as unwelcome surprises (i.e. risk management), and/or grab opportunities before your competitors. It is also common that your company will identify critical issues which had not been considered before.


4. Attract, motivate and retain employees

Your company’s high performance standards and reputation are “intangibles” that help to attract and motivate employees. This will increase the trust between your company as an employer and its employees and so enhance your reputation. In the end, your workforce will contribute more and stay longer if it is motivated, empowered, and in agreement with strategic objectives.


5. Enhance reputation, achieve trust and respect

Your company’s key stakeholders are influenced by the reputation, respect and trust you have earned. As such, there are always concerns about how much the reputation of your company might be damaged by public disclosure on potential risks or bad news. The natural instinct is for you to avoid such admissions; however, balanced reporting can create trust and respect. This means reporting both on what goes well and also on where there is room for improvement.


6. Attracting funding

Providers of financial capital are asking tough questions of companies these days. Lending institutions and investors increasingly take into consideration performance in different aspects of sustainability issues when evaluating companies, e.g. good governance, ethical values, social priorities and environmental actions. Non-profit organizations are in a similar situation where they are dependent on donors and/or sponsors to fund their project activities. Implementing a GRI reporting process can help your company to improve the general management of sustainability issues and be prepared to talk openly about your performance. This demonstrates high-quality performance management which can provide access to funds.


7. Transparency and dialogue with stakeholders

The sustainability reporting process is an important tool to achieve transparency and disclose sustainability performance to your company’s stakeholders. As an SME, your stakeholders are likely to be clients, suppliers, local community pressure groups, providers of financial capital, employees and owners.

Through the relationships which the reporting process can create between your company and its stakeholders, you can receive feedback on your business operations, which will enable you to review processes and identify business opportunities.


8. Achieve competitive advantage and leadership

Sustainability reporting is still not common practice across all regions and sectors, especially for SMEs. For this reason, your company can be identified as a “leader in sustainability”. This is especially important because an increasing number of larger companies screen potential and current suppliers for their economic, social and environmental performance and the impact this may have on their own supply chain. By being able to show existing and potential clients your company’s commitment to conducting business in a sustainable manner, you increase your chances of being selected as a preferred supplier by larger companies.



[1] Global Reporting Initiative (GRI) Ready to Report. Introducing sustainability reporting for SMEs




COP 21 Paris Agreement: the first global consensus on climate change

On 12 December 2015, the first ever universal agreement on climate change was adopted by 195 nations. The deal was made at the Paris Climate Change Conference, also known as the 21st Conference of the Parties (COP21) to the 1992 United Nations Framework Convention on Climate Change (UNFCCC).

Major points of the agreement include a capping of global temperature rises at 1.5oC above pre-industrial levels, and net-zero emissions by second half of the century. These climate change mitigation goals are accompanied by financing and review mechanisms, taking into account countries’ differentiated levels of responsibility and vulnerability to climate change.

The Paris Agreement also sends a clear signal to global markets to move to a low-carbon economy. As noted by Singapore’s Foreign Minister Vivian Balakrishan, and Edward Cameron, managing director of partnership and research at non-profit Business for Social Responsibility, the universal and legally-binding nature of the agreement, together with a transparent method of tracking each country’s performance provides the assurance to businesses that governments will support low-carbon projects for the long term.

Singapore Deputy Prime Minister Teo Chee Hean, who is also the chairman of the inter-ministerial committee on climate change said Singapore will work towards the pledge of reducing emissions intensity by 36% from 2005 levels, by 2030, and stabilising emissions with the aim of peaking around 2030.

2015 GRESB Masterclass: Sustainability and Best Practices in ESG as a part of the AsiaPac Property Leaders Summit 2015 in Singapore

Paia recently attended the GRESB Masterclass held in Singapore. GRESB, an industry-driven organization committed to assessing the sustainability performance of real estate portfolios (public, private and direct) conducted a Masterclass. GRES, has a pivotal role in transforming the current landscape as more organisations develop a strong business case to incorporate sustainability in their operations. The focus of the discussions was on rapidly changing regulatory climate and expectations in the Asia Pacific property industry.

Green buildings and spaces are seen as a solution to the crowded, unsustainable cities of the previous decades. Despite higher costs, there is a strong business case for retrofitting buildings as they age leading to huge savings. There is a marked interest in renewable energy (solar voltaic panels) and green buildings by investors, owners, tenants, regulators and other stakeholders who are investing in real estate which is capable of sustaining itself in terms of energy and water usage. Environmental, social, and governance (ESG) issues are becoming central to the long-term future of businesses as stakeholders demand more transparency. This becomes imperative as new regulatory developments lead to more stringent laws for energy usage and disclosure. Increased demand for information and transparency on the sustainability performance of property companies and fund managers is also another cause for the drive towards greener spaces. This is also evident as we see a rapid development of standards, benchmarks and certification schemes globally.

Companies such as Keppel Reit Management, one of the largest real estate investment trusts (REITs) listed on the Singapore Exchange, Redwood Group Asia, a specialized logistics warehouse real estate investment firm with a geographic focus on Asia, offices in China and Japan and Capital Land Limited, one of Asia’s largest real estate companies – were present to talk about how sustainability is incorporated into their businesses and new operations. The sustainability leaders from these organisations provided valuable insights into sustainability practices across the global property industry. Capital Land was proud to share insights into their Hangzhou Raffles City project, which is the 1st LEED Gold project in Zejiang at the GRESB Masterclass.

Based on the questions from the audience, which included investors, fund managers and real estate companies, about developing a stronger business case for incorporating sustainability and for green buildings for investors – it seems that sustainability is here to stay at the forefront of business’s agendas.

Integrated Reporting ACCA Finance and Accounting Technical Conference 2015

Integrated Reporting ACCA Accounting and Finance Conference

Paia was invited to share recent developments in Integrated Reporting, at the ACCA Finance and Accounting Technical Conference 2015, on 23rd October 2015.
Wong Dan Chi, Senior Consultant, discussed the significance of integrated reporting and the International Integrated Reporting Council (IIRC) framework. Taking a practical approach, she highlighted common misconceptions and illustrated how the principle-based framework can be applied with examples.
The event had attracted 200 finance, accounting and business professionals and garnered positive feedback from the guests and delegates.

International Integrated Reporting Council

Paia is pleased to be supporting ACCA’s prominent leadership in integrated reporting. Chief Executive of ACCA, Ms Helen Brand, sits on the Board of IIRC. Closer to home, Chiew Chun Wee, Asia Pacific Head of Policy, also serves as a member of the IIRC Working Group. ACCA Singapore has also been instrumental in supporting IIRC’s efforts in the region and raising awareness of integrated reporting by hosting events from back in 2011.

2015 – The Tipping Point for Meaningful Change?

The Paia team attended the Responsible Business Forum for Sustainable Development 2015 (RBF) held at Marina Bay Sands Convention Centre and Gardens by the Bay, 3 to 4 November 2015. The RBF saw over 600 business leaders, policy makers and NGOs from around the world gather to share innovative solutions for creating sustainable growth and delivering the Sustainable Development Goals.

2015 is indeed being hailed as a historic year for the world. The discussion at the RBF could not have been more timely, focusing on two major events this year. First, this year has seen the launch of the new post-2015 Sustainable Development Goals (SDG) to ensure prosperity and environmental protection for future generations. Second, this year will end with a new treaty to be agreed upon in Paris where the United Nations Climate Change Conference COP 21 will take place. This is where the worlds nation states will decide to limit the greenhouse gas emissions and prevent global warming beyond the two degrees that is expected. In addition, the current haze situation in the region was a hot topic that raised a few questions for the policy makers from around the region. In the opening plenary address, Singapore’s Minister for Foreign Affairs, Vivian Balakrishnan called it a ‘man-made tragedy’ and asserted that growing consumer awareness on sustainable business practices and companies’ supply chains, means that businesses have to be more transparent in their operations and policies.

Day one of the conference saw business leaders, international government officials and sustainability experts across several sectors such as agriculture and forestry, palm oil, consumer goods, building and infrastructure, energy, mining and financial services hold pertinent discussions about how improvements in innovation and technology, mind-set shifts and transparency are necessary for businesses. In the face of an ever increasing population, a consumerist society, strain on the earth’s natural capital coupled with rising carbon levels, businesses must embrace sustainability at all levels and restructure their conventional practices if they want to continue operating in this climate.

This paradigm shift has already occurred for some innovative companies such as Autodesk, April, and DSM – who have embraced transformational sustainability changes such as new closed-loop and circular business models and have become leaders in their own right. The various panels explored the possibility of transitioning to a low carbon economy, and the benefits and challenges of placing a monetary value on natural capital. Almost all agreed on the imperative need to integrate this valuation into future decision making. Organisations present were WWF, Ersnt & Young, South Pole Group, A*STAR, Rolls Royce, Aviva, Trucost, Autodesk, DHL, and NTU, to name a few.

The Sustainable Development Goals were discussed in great detail on day two by policymakers from around the region, business leaders and NGOs. The speakers ranged from businesses such as Levis Strauss & Co, Novartis, INDISKA, Sime Darby, Wilmar, HMP Family, policy makers from the Philippines, Indonesia and Malaysia, and NGO’s such as UN Women Singapore, WWF etc. The SDGs were combined into broad topics and the speakers shared their thoughts on approaches and programmes that will contribute to a transformative, inclusive, low-carbon economy where a dignified standard of living can be achieved by communities. NGOs had a special role to play on this day, as they shared their thoughts on forging effective, multi-stakeholder partnerships which are crucial for successful collaboration.

Look out for more on this page by the Paia team on Green Freight Asia (GFA) Forum: Bringing Green Freight Practices to Scale.

Green Freight Asia (GFA) Forum: Bringing Green Freight Practices to Scale

Green Freight Asia (GFA) held the Annual Forum in conjuncture with Responsible Business Forum for Sustainable Development from 2 to 4 November 2015 at Marina Bay Sands. The topic was Bringing Green Freight Practices to Scale and the discussion panel consisted of invited guests representing shippers (DHL, UPS), clients (IKEA, HP, Heineken) and NGOs (Clean Air Asia, Smart Freight Centre), chaired by Green Freight Asia CEO Stephan Schablinski. Here are some of the key points that were raised at the forum.

Why is green freight important?
Transport accounts for at least one fourth of total energy consumption in Asian countries and other parts of the world. Transport is also the number one consumer of oil, of which most comes from road transport. The significant impact freight have on the environment has led to several initiative by governments and private companies. Companies with large number of deliveries, such as HP, recognises the responsibility that comes with this much transport and are changing the way the think about logistics.

Green Freight has been included in the upcoming ASEAN strategic transport plan 2016-2025. Also, in May 2015 the UN Climate and Clean Air Coalition (CCAC) released a Global Green Freight Action Statement and Plan with the aim to enhance the environmental and energy efficiency of goods movement in ways that significantly reduce the climate, health, energy, and cost impacts of freight transport around the world. The plan can be downloaded here.

What are the benefits of green freight?
There is a common notion that the choice is either you save cost or you go green, but in this forum the answer to this was clear: There are great opportunities for cost savings in green freight. IKEA saved half a billion dollars on shifting shipping by air to sea, whereas the Green Freight India Working Group recorded that a simple implementation of driver training at TATA Steel resulted in more than 40% fuel improvement.

Suppliers are moving towards higher expectations, and requests to have deliveries by non-fossil fuel are increasing. Vendors ask their partners, what are you doing about green freight? If the answer is nothing, they lose out because the vendors change to using providers who are performing well in green freight.

Partnerhips in green freight
Green freight can be greatly facilitated through collaboration and partnerships. The transport sector which is highly fragmented needs leadership to set direction for transformational change and find approaches to influence public policy.

Companies are also engaging third parties to achieve better transparency. It is difficult to measure CO2 accurately, so organisations such as GFA or Global Logistics Emissions Council can assist by creating a universal and transparent way of calculating logistics emissions across the global supply chain.

On a practical level, Green Freight India Working Group Freight provided an excellent example on direct benefits of collaboration for green freight. is sharing platform in India, which connects vendors with shippers to avoid empty freight volumes in their transports resulting in an increased efficiency when transporting goods.

Link for more information on the Green Freight Asia and the GFA label can be found here.

Congratulations to our clients Keppel Land and CDL

Congratulations to our clients Keppel Land and City Developments Limited (CDL) for winning the prestigious Sustainable Business Awards Singapore 2015! Keppel Land Limited won in the category ‘Strategy & Sustainability Management’. CDL received the award for its performance in the category ‘Land Use, Biodiversity and Environment’.

Congratulations to our clients: MPA, Sembcorp Industries and CDL

Paia congratulates our client Maritime & Port Authority (MPA) on winning the Singapore Sustainability Awards 2015 (Large Enterprise Category). The Singapore Sustainability Awards, initiated by the Singapore Business Federation in 2009, recognise organisations for their outstanding sustainable business practices.

Congratulations also to our clients Sembcorp Industries and City Developments Limited (CDL) for winning the Most Transparent Company Award at the SIAS Investors’ Choice Awards 2015. SIAS Investors’ Choice Awards (ICA) recognise public listed companies which have demonstrated exemplary Corporate Governance and Transparency practices.

Lianhe Zaobao reports on Sustainability Reporting

Paia Consulting was featured in Lianhe Zaobao Finance (联合早报 – 财金) on Monday, October 12, 2015. The half-page spread drew on Paia’s in-house research on sustainability reporting, and insights from Wong Dan Chi, our Senior Consultant.

The reporter wrote that following the recent issues with transboundary haze, it is expected that more investors and members of the public will request companies to report on sustainability.

There has been an increase in sustainability reporting over the last few years in Singapore. According to a research Paia conducted earlier this year in May 2015, 50% of the 30 Straits Times Index (STI) firms report on sustainability using the Global Reporting Initiative (GRI) guidelines. 5 years ago, there were only 3 STI firms producing GRI-level sustainability reports. GRI is the de facto sustainability reporting standard, and reflects a certain standard of reporting quality.

In a study by Global Compact Network Singapore and the National University of Singapore, 160 companies listed on Singapore Exchange (SGX) Mainboard reported on sustainability or made disclosures in 2013, up from 79 companies in 2011. 160 companies make up about 30% of SGX Mainboard companies in 2013.

However, Singapore still lags behind North America, Europe and South Africa in both quantity and quality of sustainability reports. For example, according to a study published by the Governance & Accountability Institute in June this year, 75% of Standard & Poor’s 500 companies disclose their corporate responsibility (or sustainability) reports.

Last October, SGX indicated that they target to implement sustainability reporting on a ‘comply or explain’ basis by FY2017. Many market research reports showed that there is a positive correlation between sustainability reporting and a company’s 10-year and even 20-year financial performance.

Haze and Sustainable Procurement

The haze has hit down hard on Singapore and is affecting us all this month. This has led to a rapid expansion in public awareness on the issue and a movement such as X The Haze towards only using sustainable paper and palm oil products.

Furthermore, the Singapore Environment Council (SEC) and the government are urging the public sector to strengthen green procurement. SEC has announced plans to send letters to more than 2,800 firms asking them to commit to buying only sustainable palm oil and pulp products.

Paia advises companies to review their procurement policies, in particular whether they have a requirement to use FSCTM certified paper and RSPO certified palm oil products. We recommend using paper products certified by the Forest Stewardship Council (FSCTM), which is the leading global body promoting sustainable management of the world’s forests. RSPO refers to the Roundtable for Sustainable Palm Oil, which provides global standards for the entire supply chain on sustainable oil.
Our experienced and dedicated team at Paia can provide assistance with developing or improving your company’s sustainable procurement policies or environmental management systems.

There are several paper products on the market in Singapore which are from sustainable suppliers who have worked with NGO and certification bodies to ensure that their products are from sustainably managed forests and not involved in any burning or damaging of rainforests. Feel free to contact us for details.

Have a clear conscience day!

Banks in Singapore to Implement Responsible Financing

Banks in Singapore will for the first time be expected to disclose environmental, social and governance (ESG) policies for financing, under new industry guidelines set by the Association of Banks in Singapore (ABS) to advance responsible financing. ESG aspects include greenhouse gas emissions, labour standards and corporate integrity, which are indicators of sustainability and ethical impact of an investment or business.

ABS released the guidelines on Thursday 8 October 2015. The guidelines were developed since early 2015 in consultation with the banks ABS represents, which include 158 foreign banks and DBS, UOB and OCBC, the three largest local Singapore banks.

The Monetary Authority of Singapore has stated that it welcomes the guidelines, and will work with ABS to monitor the guidelines’ adoption and implementation.

ABS stated in their press release that “at the minimum, banks will share their vision and commitment on responsible financing in their annual reports, and publish their ESG policy framework in 12-18 months’ time”.

The guidelines comprise three principles:
i) Disclosure of senior management’s commitment,
ii) Governance
iii) Capacity building

Disclosure of the senior management’s commitment to responsible financing is expected in banks’ 2015 Annual Report. To facilitate the implementation of these guidelines, banks will need to allocate resources for internal capacity building and skills development. ABS also hopes that banks will “implement robust governance systems through appropriate policies and procedures” to fully comply with the guidelines by 2017.

ABS advises banks to focus their responsible financing policies on industries with “elevated” risk, such as agriculture, chemicals, defence, energy especially oil, gas and coal, forestry, infrastructure, mining and metals, and waste management.

The Business Times: New guidelines soon to steer banks on responsible financing
ChannelNewsAsia: ABS releases guidelines on responsible financing


The difference between Sustainability and Integrated Reporting

With the recent Singapore Exchange (SGX) consultation on its proposed “comply or explain” regulation to Sustainability Reporting, and an increasing number of companies locally producing Sustainability Reports, we felt there’s a need to clarify the difference between Sustainability Reporting and Integrated Reporting.

Sustainability Reporting is about communicating the organisation’s approach to managing its key environmental and social issues.  It is about communicating publicly how the company assesses which environmental and social issues are most significant to the company (“materiality”), how these issues are managed and how the company is performing against each of these key issues (performance data).  At Paia, we approach these issues as business risks, and opportunities.  Climate change, talent retention and employee diversity, for example, can pose both risks and opportunities for companies, so it is about communicating how the organisation is identifying and managing these risks and opportunities.

Integrated reporting is one step further – about communicating, how the company manages its long term value creation by taking an integrated approach to both traditional risks and these wider sustainability risks. Instead of reporting on financial performance and sustainability performance separately, or even within the same AR, Integrated Reporting intends to show how the company integrates environmental & social thinking into its business.

So for example, an integrated report goes beyond financial, employee, environmental and social data, to also demonstrate how the company integrates these broader risks and opportunities into its long term strategy, into its risk management, into operating policies and procedures, and what the trade offs between these issues are.

This means Integrated reporting pulls together information that sits in separate reporting strands to explain how the firm creates value. In the Singapore context, these reporting strands will include the i) Corporate Governance Statement, ii) Operating and Financial Review, iii) Financial Statements and more recently, iv) Sustainability Reporting.

“Sustainability reporting relates to one important aspect of a company’s performance, without which an integrated report would be incomplete.”

– Ian Ball, International Integrated Reporting Council (IIRC) Board member & Principal Advisor and ex-CEO of International Federation of Accountants (IFAC)

In Singapore, and the region, it is often the sustainability reporting which is the weakest link to integrated reporting.  Many companies in this region are only just beginning to develop their sustainability reporting practices.

So should companies just leapfrog to Integrated Reporting, and bypass Sustainability Reporting?  Companies don’t necessarially need to publish sustainability reports, but they do need to put in place the sustainability fundamentals, for which GRI provides clear guidance.  Paia’s experience of having worked with over 25 companies in Southeast Asia on both their sustainability and/or integrated reporting programmes, has taught us that it is fundamental for companies starting out in their reporting journeys to firstly identify what their key environmental and social risks and opportunities are, create management programmes to manage these risks and maximise the opportunities and develop KPIs to track environmental and social performance.  These are the fundamentals of sustainability reporting.

It takes time

To embed these systems takes a couple of years.  It takes time for companies to really grasp the business benefits of sustainability and develop appropriate systems to manage these risks in a way that is appropriate for the individual company.  It is only then that companies are ready to embrace integrated thinking and integrated reporting in a meaningful way.

We are a great supporter of integrated thinking; that has always been our approach.  We’ve had the please of working closely with many clients to integrate environmental and social risks into their ERMs, business strategy, policies, procedures and contract agreements, and this experience has taught us that it takes time to achieve this integration, as it requires some level of change management – for example to include environmental and social risks within business investment decisions.

Conclusion: get the sustainability part right first

Sustainability reporting tends to be the part of Integrated Reporting that Southeast Asian companies are weakest one, hence we recommend companies take time to embed sustainability, before proceeding to Integrated Reporting.


Carrie Johnson


Paia Consulting Pte Ltd

21 May 2015

50% of STI companies produce GRI-level sustainability reports

As of 12 May 2015, 50% of top 30 companies in Singapore by market capitalisation, which forms the Straits Times Index, produce sustainability reports in accordance with Global Reporting Initiative (GRI). GRI is the most established sustainability reporting guideline internationally, and is cited as a recommended guideline in the Guide to Sustainability Reporting issued by Singapore Exchange (SGX).

There has been a steady rise in the number of organisations that produce GRI-level sustainability reports in Singapore, from only 3 in 2008 to 35 by 2014. New GRI reporters in 2014 include ST Engineering, Thai Beverage PLC and CapitaCommercial Trust. Numbers are expected to rise rapidly as SGX takes steps to implement a comply-or-explain sustainability reporting regime.


SGX is targeting implementation of comply-or-explain sustainability reporting for financial year 2017. SGX will be engaging listed companies, institutional investors, sustainability professionals and the public on legislating a comply-or-explain sustainability reporting regime in 2015 (see details in SGX’s announcement).

Paia Consulting is a specialist sustainability consultancy based in Singapore.

Responsible Business Summit Asia 2015

Best practice for the first Responsible Business Summit Asia

With about 100 registered participants from Singapore, Hong Kong and China, India, Japan, the Philippines, Sri Lanka, Thailand, Australia, Europe and the US, the first Responsible Business Summit Asia initiated discussions between representatives from corporations, academia, press, non-for profit as well as some government agencies. It was organised by the Ethical Corporation on 6-7 May 2015 in Singapore.

Participants got hands-on advice how to get the company’s sustainability efforts understood by its target audience, how to better engage communities to minimise social risks and build trust, and how to ensure responsible business consistency throughout the supply chain, learning from diverse industries including banking, beverages, chemicals, consumer goods, health, palm oil, resource extraction, telecom, transportation. The guiding question – when and how does sustainable innovation pay off – was answered by in-depth analysis and best practice sharing, including strategies for product innovation by embedding social and environmental standards, and learning from crisis before it happens. The presentations showed that even the classical sustainability themes – stakeholder engagement and reporting – are under continuous development. The most successful cooperation between a company and an NGO (Greenpeace) came – surprisingly? – out of the palm oil industry. The discussion on employee engagement included recommendations how to promote skill-based volunteering. In reporting, the focus on (social, environmental and economic) impacts rather than mere outputs is the international trend, and some companies develop new formats for their sustainability reports, tailor-made for different target groups.

Given the high level of competence and active participation, collaboration and innovation for sustainable business growth in region can be expected as a benefit of the summit. We will keep you informed about follow-up events.

SGX Targets Mandatory Sustainability Reporting for FY2017

Update (21st June 2016) SGX launches Comply or Explain Sustainability Reporting

Update (5 Jan 2016): SGX releases Consultation Paper. Read more here.

On the 6th of May 2015, the Singapore Exchange (SGX) announced plans to implement sustainability reporting on a ‘comply or explain’ basis. Under this regime, companies that do not follow SGX’s guidelines will be expected to explain why.

A new listing rule will be developed using Information SGX receives via an initial consultation exercise with listed companies; the information will be used to review SGX’s existing guidelines to sustainability reporting.

SGX expects the proposed Listing Rule and reviewed Guide to be submitted for regulatory approval by the end of 2015; and targets implementation for financial year 2017.

SGX is inviting stakeholders to participate in what is one of the most broad-ranging consultation exercises conducted by the exchange. In May 2015, SGX will conduct a survey of listed companies and run a series of focus group engagements to understand current sustainability reporting practices and the level of readiness among listed companies. Following this, SGX plans to reach out to institutional investors and sustainability professionals for feedback on the ‘Guide to Sustainability Reporting for Listed Companies’ published in 2011. Finally, SGX will conduct a public consultation (including the investing public) on the Listing Rule and reviewed Guide.

In a statement by SGX chief executive, Magnus Bocker, “We believe that greater transparency from listed companies will attract investors and empower them to make more informed decisions.”

Details can be found on SGX’s announcement ‘Consultation Exercise on Sustainability Reporting’, 6 May 2015.

Read more:

Need more information: Paia offers Sustainability Training to help you meet SGX requirements. Contact Us today.

Strategy and Reporting Services

Our clients CDL, MPA, Sembcorp, SCM and ST Eng publish GRI reports

Congratulations to our clients City Developments Limited (CDL), Maritime & Port Authority (MPA), Sembcorp Industries, Sembcorp Marine and ST Engineering on the recent release of their GRI G4 reports.

MPA’s inaugural report is both G4 Comprehensive and incorporates the International Integrated Reporting Council (IIRC) Integrated reporting framework. In the latest report, Sembcorp continues its clear and structured reporting, and added a feature articulating the value creation process.

Launch of the Singapore Sustainability Label

The Singapore Business Federation (SBF) has launched the Singapore Sustainability Label to enable organisations to benchmark their sustainability business practices. Companies can apply to be accredited any time throughout the year and may reach Bronze, Silver, Gold or Platinum status depending on their sustainability performance. The Label aims at recognising excellence in the community of new “adopters”, as well as distinguishing those with more established sustainability practices.

The Label is open to all Singapore-registered companies, public institutions and agencies.

Paia Consulting is SBF’s Knowledge Partner for the Label. We have developed the judging criteria and will serve as assessors of applicants.

Paia and SBF have developed a self-assessment tool to enable organisations to estimate their level before applying. After application, SBF arranges a meeting to evaluate the application with the assessors.

If you are interested in the self-assessment or the application, you can register online here.

sgx sustainability reporting workshop

SGX: Comply or explain approach to Sustainability Reporting

Reported from the Singapore Compact CSR Summit 2014 by Gillian Lim, Paia Consulting

The Singapore Exchange (SGX) announced that it will be enforcing a “comply or explain” approach to Sustainability Reporting in the near future, and hinted that may shift to fining companies for non-compliance further down the line.

The announcement came from Mr Magnus Bocker, Chief Executive Officer of SGX, during his keynote speech at the Singapore Compact CSR Summit on 17 October 2014.

SGX released voluntary sustainability reporting guidelines in 2011 to encourage firms to share relevant environmental and social information with investors. However, take up has been slow with feedback that many companies are waiting for the bourse to make it a rule.

Alluding to the improvements made to Corporate Governance guidelines over the last few years and how they have made SGX a better exchange, Bocker stated that he wishes to approach sustainability reporting in a similar manner. He also mentioned that new tools will be made available to SGX in coming years, including the ability to fine companies for non-compliance. While fining for non-compliance of sustainability reporting may not happen for several years, Bocker pointed out that these new tools are nevertheless expected to improve regulation over time.

He highlighted regional initiatives in Malaysia, India and Taiwan to promote sustainability reporting, practices and responsible investment. Globally, the world is getting increasingly involved in sustainability, including the World Federation of Exchanges, which has set up a sub-committee to look at ESG issues.

Bocker stressed the importance of seeing sustainability reporting as an opportunity to create a business advantage. Reporting helps superior companies show their quality and their investors avoid surprises. He indicated that many banks already give “green” companies lower loan rates and that overseas investors, including pension funds, coming to Singapore have already been asking about sustainability reporting.

Reporting metrics allow for improved understanding of the company and for benchmarking exercises, thereby fuelling competition. “Fear of poor numbers can’t be a reason why we don’t do reporting,” said Bocker. Greater transparency leads to increased profitability for Singapore, which has a strong reputation in governance and transparency.

SGX will be holding a one year consultation period with companies and investors, following which they will be looking to make reporting mandatory.

Paia Consulting is a leading sustainability consultancy established since 2002. We helped produce Singapore’s first GRI report and many award-winning reports. Beyond reporting, many of the companies leading sustainability locally are our clients. Drop us a note at to discuss how we can support your sustainability journey


Institutional investors call governments for effective carbon pricing

Institutional Investors Call Governments for Effective Carbon Pricing

Nearly 350 global institutional investors released a statement for government provision of stable, reliable, and economically meaningful carbon pricing just days before the Climate Summit at the United Nations headquarters in New York. The four investor groups on climate change – Ceres’ Investor Network on Climate Risk (INCR), the European Institutional Investor Group on Climate Change (IIGCC), the Investors Group on Climate Change (IGCC), and the Asia Investor Group on Climate Change (AIGCC) – were responsible for coordinating the Global Investor Statement on Climate Change, alongside the United Nations Environment Programme Finance Initiative (UNEP FI) and Principles for Responsible Investment (PRI).

The statement acknowledges the role that investors play in financing clean energy and outlines the steps they are committed to take; however, the group of global investors, collectively representing more than $24 trillion in assets, declare that stronger political leadership and policies are needed for them to scale up investments. In 2013, global investment in clean energy amounted to $254 billion, falling very much short of the $1 trillion a year investment necessary to limit the effects of global warming to 2 degrees Celsius, as estimated by the International Energy Agency (IEA).

The statement demands government turn climate-related policies into mainstream action. The international investor community has already begun addressing climate change issues; alongside the statement, the group of institutional investors also published both an online database and a report that describe how they have begun to act on climate change, including direct low carbon investments, the creation of low carbon funds, company engagement, and reduced exposure to fossil fuel and carbon-intensive companies. Specific examples included in the report include the following:

  • ŸŸŸA Swedish pension fund, AP4, has committed to decarbonising its entire equities portfolio
  • ŸŸŸThe Zurich Insurance Group plans to invest up to $2 billion in green bonds; this is only one of the group’s many commitments that led to a 20-fold growth in the green bond market since 2012ŸŸŸ
  • Global bank ING has reduced its energy project loan allocation to coal power from 63% to 13% in 7 years; it has also increased its allocation to renewable energies from 5% to 39%ŸŸŸ
  • The China Utility-Based Energy Efficiency Finance Programme has provided loans worth $790 million to finance 226 projects, which has led to a reduction in emissions of 19 million metric tons of Carbon

The public online database – the Low Carbon Investment Registry – serves to encourage international asset owners to add examples to the Registry before the climate negotiations in Paris begin in 2015, which will provide policymakers a clearer understanding of how private capital is already flowing into low carbon investments.

Sustainalytics ESG Research Now Available on Bloomberg

Source: Sustainalytics Press Release, 27 May 2014.

Toronto – May 27, 2014 – Today, Sustainalytics announces that its environmental, social and governance (ESG) research assessments are now available to the more than 320,000 subscribers of the Bloomberg Professional service. As a third-party ESG research provider, Sustainalytics will offer clients that subscribe to both platforms access to a subset of Sustainalytics’ ESG ratings and coverage.

“The inclusion of ESG information on platforms such as Bloomberg is yet another positive indication of the mainstreaming of sustainability in capital markets,” said Michael Jantzi, CEO of Sustainalytics. “Having corporate ESG performance data housed alongside more traditional financial information allows investors to more easily integrate ESG factors into their fundamental analysis.”

Through the Bloomberg Professional service, users can deliver Sustainalytics’ assessments, alongside market data and other third-party and company reported ESG data, into a Microsoft Office document to fuel proprietary ESG models, research and reports.

Sustainalytics’ proprietary indicators will provide investors with a macro level assessment of how companies are managing their ESG capital. All Bloomberg users will have access to high-level company scores and percentile rankings across the environmental, social and governance dimensions. Clients that subscribe to both platforms will have access to more in-depth assessments of approximately 1,600 global, developed market companies, ranked against their industry peers across 15 performance indicators, including:

Thematic and overall Environmental, Social and Governance scores,
Momentum indicators, which reflect ESG trends scores over time,
Controversy assessments, identifying high-profile environmental, social or governance incidents involving the company,
Preparedness, Disclosure, and Performance assessments which offer investors insights into a company’s ESG management and risk exposure,
Product involvement indicators highlighting company exposure to a list of 11 product lines, such as tobacco, nuclear power generation or military contracting.

To improve analysis and better identify trends over time, historical scores dating back to 2009 will also be made available in the coming months.

“We have seen the number of customers using ESG data increase at an annual rate of 48%, which means that there is a growing demand for this type of information,” said Curtis Ravenel, Global Head, Sustainability Initiatives at Bloomberg. “It is becoming a critical element in the decision making process of investors and more specifically our customers and the collaboration with Sustainalytics will enhance our offering on the Bloomberg Professional service.”

For more information about accessing Sustainalytics ESG research data via your Bloomberg Professional Services account, Sustainalytics and Bloomberg users should contact their account managers.


About Sustainalytics

Sustainalytics is an independent ESG research and analysis firm supporting investors around the world with the development and implementation of responsible investment strategies. The firm partners with institutional investors who integrate environmental, social and governance information and assessments into their investment decisions.

Headquartered in Amsterdam, Sustainalytics has offices in Boston, Bucharest, Frankfurt, London, Paris, Singapore, Timisoara and Toronto, and representatives in Bogotá, Brussels, Copenhagen, New York City and San Francisco. The firm has 160 staff members, including more than 100 analysts with varied multidisciplinary expertise and thorough understanding of more than 40 industries. In 2012 and 2013, Sustainalytics was voted best independent sustainable and responsible investment research firm in the Thomson Reuters Extel’s IRRI survey.

About Bloomberg

Bloomberg, the global business and financial information and news leader, gives influential decision makers a critical edge by connecting them to a dynamic network of information, people and ideas. The company’s strength – delivering data, news and analytics through innovative technology, quickly and accurately – is at the core of the Bloomberg Professional service, which provides real time financial information to more than 320,000 subscribers globally. Headquartered in New York, Bloomberg employs more than 15,500 people in 192 locations around the world.

Bloomberg’s environmental, social and governance (ESG) news, data and research are a fully integrated feature of the Bloomberg Professional service. Data for over 10,000 companies, ranging from emissions and energy consumption to accident rates and board independence, is displayed in the same screen as the fundamental data that investors, analysts and corporate executives use every day. ESG data is compatible with all of Bloomberg’s cutting edge analytics to better compare companies on ESG metrics.


Melissa Chase
Marketing Specialist





Thomson Reuters launches ESG tool

Thomson Reuters have joined the ranks of information providers for investors to provide extensive sustainability, or Environmental, Social and Governance (ESG), data. The Thomson Reuters Corporate Responsibility Ratings (TRCRR) ESG Portal was launched in April 2014.

It reviews about 225 key performance indicators and more than 500 data points. The TRCRR ESG Portal “affixes ESG ratings to more than 4,600 public companies worldwide constituting more than $47 trillion (91.3%) in global market cap.”

Besides ESG data, the portal also provides a suite of 12 ESG-focused indices.

Aimed at the investing public, besides the target markets of financial institutions and money managers, financial advisors can access the portal for $600 yearly or $59 monthly.


Full article from Financial Advisors

Thomson Reuters ESG Research Data


Strategy and Reporting Services

BT reports – More companies providing sustainability reports

The Business Times, Thursday, August 1, 2013

Paia Consulting was featured in Business Times article reviewing the sustainability reporting scene. The article reported the rapid growth of sustainability reports published, and also highlighted CapitaLand’s savings from their sustainability strategy.

Read about the list of GRI reports in Singapore and Malaysia here.

Explore our site to find out more about clients we have helped, and services we offer to help your company in your sustainability journey.


Paia Consulting is a leading sustainability consultancy established since 2002. We helped produce Singapore’s first GRI report and many award-winning reports. Beyond reporting, many of the companies leading sustainability locally are our clients. Drop us a note to discuss how we may support your sustainability journey.

GRI G4 Guidelines released at GRI Conference 2013

27 May 2013

Global Reporting Initiative (GRI), the leading global sustainability reporting framework, has released its fourth iteration G4 at the GRI Conference 2013 in Amsterdam. Paia was represented by our Director Carrie Johnson.

There are two parts in G4 Guidelines. Users should begin with Part 1, which elaborates on the Reporting Principles and Standard Disclosures, then move on to Part 2 which is the Implementation Manual.

Part 1 is particularly important with the renewed and heavily emphasised focus on materiality in G4. “The emphasis on what is material encourages organizations to provide only information that is critical to their business and stakeholders. This means organizations and report users can concentrate on the sustainability impacts that matter, resulting in reports that are more strategic, more focused, more credible, and easier for stakeholders to navigate.”

Download them here: Part 1 & Part 2


Video recordings of the GRI Conference will be made available in the following weeks. We will put a note up on our blog when GRI notifies conference attendees of the videos. Subscribe to our blog (upper right hand corner) to be notified of new blog posts.

Paia will be organising workshops for companies who wish to have an in-depth understanding on implications for G4. Email us at if you are interested.

sgx investors guide

SGX launches An Investors Guide to Reading Sustainability Reports

SGX has released An Investor’s Guide to Reading Sustainability Reports and 10-minutes video featuring Ms Carrie Johnson, Director of Paia Consulting, on Understanding Sustainability from an Investor’s perspective.

A quick 6 page document, this guide seeks to help investors focus on the following:

– What is Sustainability?

– Why is it relevant?

– Why invest in companies that endorse sustainability and adopt sustainability reporting?

– Where do I find sustainability information on listed companies?

– What are some key issues to look out for and questions to ask at annual general meetings (AGMs)?

SGX to move to ‘comply or explain’ basis

On 19 Mar 2013, Singapore Exchange (SGX) announced at RI Asia 2013, the environmental, social and governance (ESG) summit that SGX will move to a “comply or explain” basis for reporting standards. 

Read more

Rio+20: Themes, Priority Areas and Conclusion

Rio+20 is a short name for the United Nations Conference on Sustainable Development that took place in Rio de Janeiro, Brazil last 20-22 June 2012.

The date marks the 20th anniversary of the United Nations Conference on Environment and Development (UNCED) held in Rio de Janeiro and the 10th anniversary of the World Summit on Sustainable Development (WSSD) held in Johannesburg.

Rio+20 discussed two themes and seven priority areas. The themes were (a) a green economy in the context of sustainable development and poverty eradication and (b) the institutional framework for sustainable development.

Seven areas given priority were decent jobs, energy, sustainable cities, food security and sustainable agriculture, water, oceans, and disaster readiness.

At Rio+20 governments were expected to adopt practical measures for implementing sustainability. Nearly a month after the conference, there have been mixed views from key opinion formers on whether such expectation was met. Nevertheless, aspirations for sustainable development remain and continue to increase in urgency as countries face significant challenges.

For more information and updates post-Rio+20, visit

National Climate Change Strategy (NCCS) Document 2012

Launched on 14 June 2012 by Mr Teo Chee Hean, Deputy Prime Minister at the National Climate Change Youth Conference in Singapore, the NCCS 2012 outlines Singapore’s strategy and plans to address climate change. The National Climate Change Secretariat developed NCCS in collaboration with the Inter-Ministerial Committee on Climate Change and with inputs from private and public groups.

The strategy plans to reduce emissions by 7% to 11% against Business As Usual (BAU) 2020 levels projected at 77.2 million tonnes CO2-equivalent. If there is a legally-binding global agreement in which all countries implement their commitments in good faith, this target will be increased to 16% below BAU 2020 levels.

Apart from reducing emissions, the strategy aims to build capabilities and expertise on climate science and adaptation. Studies are already ongoing to learn more about the effects of climate change on the island state. Moreover, growth opportunities are identified specifically on developing a cleantech industry.

Lastly, the Singapore government recognizes the importance of keeping and establishing partnerships in addressing climate change. These partnerships include private sector collaboration, public consultations, NGO engagement, and international participation to United Nations Framework Convention on Climate Change (UNFCCC).

For more information and developments to NCCS 2012, please visit

SGX/MAS revises Code of Corporate Governance

On 2 May 2012, Singapore Exchange (SGX) & Monetary Authority of Singapore (MAS) released the new Code of Corporate Governance, which formally incorporates sustainability considerations into governance.

1.1(f) The Board’s role is to consider sustainability issues, e.g. environmental and social factors, as part of its strategic formulation.

View the full Code of Corporate Governance here

SGX launches Guidelines to Sustainability Reporting

On 27 Jun 2011, Singapore Exchange (SGX) launched Guidelines to Sustainability Reporting, following a public consultation in Aug 2010 over accountability for conducting businesses in a sustainable manner.

SGX’s Malaysia counterpart, Bursa Malaysia, has made CSR mandatory reporting for listed companies four years ago. Hong Kong is also looking at its reporting guide.

In SGX CEO Mr Magnus Bocker’s words “We will never be leaders as a global exchange, unless our companies are global leaders in the way they report, in the way they do business”.

View the full Guidelines here