ESG in Singapore: Essential regulations for businesses
Summary Table
| Regulation Name | Businesses Affected | Regulatory Body | Implementation Date | Regulation Purpose | Voluntary/Mandatory | Potential Benefits | Penalties for Non-Compliance |
|---|---|---|---|---|---|---|---|
| Green Finance Action Plan | Financial institutions | Monetary Authority of Singapore | 2019 | Promote sustainable finance and resilience | Voluntary | Development of sustainable products and services | None |
| Green and Transition Taxonomy | Financial institutions | Monetary Authority of Singapore | 2021 | Classify environmentally sustainable activities | Voluntary | Guide investment decisions towards sustainable projects | None |
| Mandatory Climate-Related Disclosures | Listed companies | Singapore Exchange | 2022 | Enhance transparency on climate-related risks | Mandatory | Improved risk management and investor confidence | Potential fines, reprimands, trading suspensions, and delisting from SGX-ST |
| Disclosure and Reporting Guidelines for Retail ESG Funds | Fund managers | Monetary Authority of Singapore | Jan-23 | Ensure transparency in ESG-labeled retail funds | Mandatory | Increased investor trust and market integrity | Potential fines and penalties for non-compliance |
| Green Bond Framework | Issuers of green bonds | Monetary Authority of Singapore | 2017 | Provide guidelines for issuing green bonds | Voluntary | Facilitate financing for environmentally beneficial projects | None |
| SRAC Recommendations | Listed and large non-listed companies | Sustainability Reporting Advisory Committee | 2022 | Recommend mandatory climate-related disclosures | Mandatory | Enhanced sustainability reporting | Potential fines and penalties for non-compliance |
| Green and Sustainable Finance Grant Scheme | Issuers of green and sustainable bonds/loans | Monetary Authority of Singapore | 2020 | Support issuance of green and sustainable bonds/loans | Voluntary | Financial support for external reviews and ratings | None |
| Sustainable Development Goals (SDGs) Integration | Various sectors | Government of Singapore | 2015 | Align national policies with UN SDGs | Voluntary | Promote sustainable development | None |
| Energy Conservation Act | Large energy users | National Environment Agency | 2013 | Mandate energy management practices | Mandatory | Improved energy efficiency and cost savings | Potential fines and penalties for non-compliance |
| Carbon Pricing Act | Large emitters | National Environment Agency | 2019 | Impose carbon tax to reduce emissions | Mandatory | Financial incentive to lower greenhouse gas emissions | Potential fines and penalties for non-compliance |
| Environmental Protection and Management Act (EPMA) | Various industries | National Environment Agency | 1999 | Regulate pollution control and waste management | Mandatory | Protection of environment and public health | Potential fines and/or imprisonment |
| Workplace Safety and Health Act (WSHA) | All employers | Ministry of Manpower | 2006 | Ensure safe and healthy working conditions | Mandatory | Reduced workplace accidents and improved safety | Potential fines and penalties for non-compliance |
| Public Sector Sustainability Plan | Public sector agencies | Government of Singapore | 2020 | Set sustainability targets for public agencies | Voluntary | Enhanced energy and water efficiency, waste reduction | None |
If you are looking for an experienced ESG expert who can help your business get the best out of these regulations, learn more about our services here
Details about the regulations
Here’s a summary of the key ESG regulations applicable in India:Here’s a summary of the ESG regulations in Singapore, including their background, impact on businesses, important dates, and the type of ESG expert that can help:
- Green Finance Action Plan
Background: Launched by MAS to promote sustainable finance and resilience to environmental risks.
Impact on Businesses: Encourages financial institutions to develop sustainable products and services.
Important Dates: Ongoing initiatives since its launch in 2019.
ESG Expert: Sustainable finance specialists. - Green and Transition Taxonomy
Background: Helps classify environmentally sustainable activities.
Impact on Businesses: Guides investment decisions towards sustainable projects.
Important Dates: Introduced in 2021.
ESG Expert: Environmental consultants and financial analysts. - Mandatory Climate-Related Disclosures
Background: Based on TCFD recommendations to enhance transparency.
Impact on Businesses: Requires listed companies to disclose climate-related risks and opportunities.
Important Dates: Phased implementation starting from 2022.
ESG Expert: Climate risk analysts and sustainability reporting specialists. - Disclosure and Reporting Guidelines for Retail ESG Funds
Background: Ensures transparency in ESG-labeled retail funds.
Impact on Businesses: Fund managers must disclose ESG criteria and methodologies.
Important Dates: Effective from January 2023.
ESG Expert: ESG fund managers and compliance officers. - Green Bond Framework
Background: Provides guidelines for issuing green bonds.
Impact on Businesses: Facilitates financing for environmentally beneficial projects.
Important Dates: Established in 2017.
ESG Expert: Green bond advisors and financial consultants. - Sustainability Reporting Advisory Committee (SRAC) Recommendations
Background: Recommends mandatory climate-related disclosures.
Impact on Businesses: Affects both listed and large non-listed companies.
Important Dates: Recommendations made in 2022.
ESG Expert: Sustainability reporting experts and auditors. - Green and Sustainable Finance Grant Scheme
Background: Supports issuance of green and sustainable bonds and loans.
Impact on Businesses: Covers expenses for external reviews and ratings.
Important Dates: Launched in 2020.
ESG Expert: Grant application specialists and financial advisors. - Sustainable Development Goals (SDGs) Integration
Background: Aligns national policies with UN SDGs.
Impact on Businesses: Encourages sustainable practices across sectors.
Important Dates: Ongoing since 2015.
ESG Expert: SDG consultants and policy advisors. - Energy Conservation Act
Background: Mandates energy management for large users.
Impact on Businesses: Requires energy audits and efficiency plans.
Important Dates: Enacted in 2013.
ESG Expert: Energy auditors and efficiency consultants. - Carbon Pricing Act
Background: Imposes a carbon tax to reduce emissions.
Impact on Businesses: Financial incentive to lower greenhouse gas emissions.
Important Dates: Introduced in 2019.
ESG Expert: Carbon management specialists and environmental economists. - Environmental Protection and Management Act (EPMA)
Background: Regulates pollution control and waste management.
Impact on Businesses: Ensures compliance with environmental standards.
Important Dates: Enacted in 1999.
ESG Expert: Environmental compliance officers and waste management experts. - Workplace Safety and Health Act (WSHA)
Background: Ensures safe and healthy working conditions.
Impact on Businesses: Requires implementation of safety measures.
Important Dates: Enacted in 2006.
ESG Expert: Occupational health and safety specialists. - Public Sector Sustainability Plan
Background: Sets sustainability targets for public agencies.
Impact on Businesses: Encourages green procurement and efficiency.
Important Dates: Launched in 2020.
ESG Expert: Public sector sustainability advisors.
Disclaimer- Please remember that ESG regulations are evolving over time, and to stay updated on which specific regulations influence your business the most, you need to consult with an ESG expert. You can find Singapore’s top ESG specialists here.
