Global competitiveness of Asean firms increasingly rides on ESG readiness

IN THE year ahead, businesses in Singapore and South-east Asia would be wise to tighten their climate, human rights, biodiversity and nature-resource management as policies increasingly seek to eliminate corporate externalities.

Expectations of emissions’ rising costs mean that companies’ competitiveness will hinge on their readiness to stay ahead of environmental, social and governance (ESG) regulations, industry observers told The Business Times.

Calm before the storm

More carbon tariffs could follow in the footsteps of the European Union’s Carbon Border Adjustment Mechanism (CBAM), which imposes a tax on the carbon footprint of imports in high-emitting sectors. Charlie Knaggs, Asia-Pacific regional partner for decarbonisation at sustainability consultancy ERM, noted that Australia is among countries considering similar measures, suggesting a global shift towards a more uniform approach to pricing carbon emissions.