Green expectations: The MAS consults on environmental risk management guidelines
The MAS is currently consulting banks, asset managers and insurers on proposed environmental risk management guidelines (“Guidelines”) to enhance their resilience to and management of environmental risk.
Environmental risk considerations are a hot topic for the MAS. Last year, the regulator announced it is “working on a comprehensive, long-term strategy to make sustainable finance a defining feature of Singapore’s role as an international financial centre”. The MAS also rolled out its Green Finance Action Plan, aimed at facilitating sustainable finance: the practice of integrating environmental, social and governance criteria into financial services, to bring about sustainable development outcomes.
This push for sustainable finance is backed by a growing recognition of the impact of environmental risk on financial institutions. The MAS has emphasised the importance of resilience against such risk, and has set out in the proposed Guidelines sound practices on the governance, management and disclosure of environmental risk. In our alert, we outline the MAS’ key proposals and briefly examine global developments in environmental risk management.