Singapore should take the lead in sustainable finance

THIS year's persistent haze, which continues to cast a heavy pall over Singapore, Indonesia and Malaysia, drives home an important message: when it comes to sustainability and environmental stewardship, business-as-usual is not acceptable.

The haze, arising from forest fires as a traditional means of clearing land in Indonesia, has been an annual occurence for well over a decade. Public infuriation typically dissipates once the rainy season begins to douse the fires. This year's prolonged blight, thanks partly to the El Nino weather phenomenon, has an obvious silver lining: awareness of the importance of sustainable practice and stewardship is at an all-time high. Now, more than ever, investors, providers of capital, regulators and consumers should exercise their prerogative to sanction or withhold capital from polluters.

To be sure, that is more easily said than done. But actions taken in some quarters this year have been the most decisive yet and may well signal a sea change in attitude and enforcement. Singapore's National Environment Agency has, for instance, taken action against six companies for possible violations of the Transboundary Haze Pollution Act. Those found guilty may be fined up to S$100,000 a day, capped at S$2 million. In the consumer arena, the Singapore Environment Council and the Consumers Association of Singapore have issued a list of more than 80 companies, including supermarkets and retailers, that have stated that their procurement of wood, paper and pulp is from sustainable sources. Significantly, banks are also drawing up policies on lending, in relation to environmental, social and governance (ESG) factors, as per guidelines from the Association of Banks Singapore.