MAS Seeks Input on Coal Phase-Out
According to Minister Indranee Rajah, the Monetary Authority of Singapore (MAS), in collaboration with industry representatives, will incorporate public feedback into the upcoming Singapore-Asia taxonomy, which will launch later this year.
The taxonomy aims to accelerate green and transition finance flows, facilitating the decarbonisation of brown sectors.
Formerly known as the Singapore Taxonomy, the guidelines, originally scheduled for release in June, will now be subjected to feedback from financial institutions to include additional criteria.
Simultaneously, the government plans to update the Singapore Green Bond Framework to align with the Singapore-Asia Taxonomy for green activities. Indranee reveals that public sector transition bonds may also be explored for eligible projects in accordance with the taxonomy.
Singapore's sustainable debt market has experienced substantial growth, expanding from around US$2 billion in 2018 to over US$20 billion in the previous year, notes Indranee.
In 2022, the government introduced the Singapore Green Bond Framework, adhering to ICMA principles, with a commitment to issue up to S$35 billion in green bonds by 2030. Last year, Singapore issued its inaugural sovereign green bond worth $2.4 billion, directed towards expanding the electric rail network and promoting greener transportation.
Indranee promises a post-issuance green bond report in the coming months, providing details on the allocation and expected impact of financing the electric rail projects.
In addition, MAS commences a public consultation on a voluntary code of conduct for ESG rating and data product providers. Indranee highlights the need for industry standards to enhance market confidence and mitigate greenwashing risks.
The code aims to enhance the quality, reliability, and transparency of ESG ratings and data products within Singapore. ESG rating and data product providers will be required to disclose how they incorporate forward-looking elements into their offerings. This will enable financial market participants to better understand the purpose of ESG products and accurately assess transition risks and opportunities.
MAS intends to adopt a phased and risk-proportionate regulatory approach for ESG rating and data product providers while monitoring global regulatory developments. The possibility of a more formalised framework will be considered in the future.
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Source: The Edge Singapore