More firms appointing chief sustainability officers, creating dedicated teams

Source: straitstimes.com

Few firms would have had executives focusing on sustainability five years ago, but they are becoming familiar faces now in the wake of a stronger push towards a more eco-friendly world. Firms across diverse sectors are appointing leaders and teams to help the enterprise mitigate climate-related risks while guiding it into greener pastures.

Mediacorp, ComfortDelGro and UOB have all appointed chief sustainability officers (CSOs) in the past few months or have set up new board committees for green efforts.
 

Focus on sustainability

More global financial institutions are also locating their regional environmental, social and governance (ESG) heads and teams in Singapore, including Deutsche Bank, Fidelity International and ANZ Bank.

The Monetary Authority of Singapore (MAS) said:

"We welcome and encourage financial institutions to set up regional sustainability teams in Singapore to support Asia's transition. This will enable financial institutions to gain valuable first-hand experience in the region to understand the challenges and opportunities in sustainable finance here."

The MAS added that it has also started the search for a CSO.

Ms Ling Su Min, a partner at KPMG in Singapore and head of clients, markets and innovation, said this trend has picked up over the past year:

"Companies are also giving greater oversight to ESG's governance structures, with increased focus directed at integrating ESG holistically within traditional functions. Hence, they are also formalising these responsibilities in a CSO leadership appointment." 

National University of Singapore Business School associate professor Lawrence Loh added that the rationale is to have a senior leader at the C-suite level to lead the enterprise-wide sustainability effort.

Prof Loh, who is also the director for the Centre for Governance and Sustainability, said responsibilities of the sustainability team can include preparing sustainability reports, which are now required of listed companies.
 

What firms are doing

UOB's newly appointed CSO, Mr Eric Lim, said the purpose of his role is to address the bank's entire sustainability strategy and bring disparate green initiatives together. Mr Lim, who is also the bank's head of group finance, added:

"Having these two hats helps me balance the business of sustainability, to ensure it is in itself sustainable. How we use our balance sheet is very important."

He noted that the CSO can bring together everything from risk management and financing to strategic communication. He heads a central team of five but also has partners in diverse departments to ensure sustainability is a key focus across the bank.

Real estate firm CDL has had a sustainability team since 2012. CSO Esther An said:

"Sustainability is very broad. It requires teams to collaborate. For us, it is not just about finance, but we need people with technical knowledge on green buildings and enhancing energy efficiency, for instance."

She added that CDL allocates about 2 per cent to 5 per cent of construction costs of new developments to green features and green design. The firm provides quarterly updates on its sustainability performance on a dedicated website.

"Last year, the growth of interest in sustainability was really fast and furious because people saw that the health of the planet, economy and people are interconnected. Either you change or be changed. You cannot go against the waves."

On the retail front, e-commerce player Zalora Group has pivoted to going greener.

Head of sustainability Louise Pender said:

"We fully appreciate that the fashion industry has a significant impact on the environment and the community at large, so we have always striven to take accountability for our actions and do our part as the leading fashion and lifestyle e-commerce player in the region to address these issues holistically."

She noted that last year, the firm diverted 86 per cent of warehouse waste from landfills through recycling efforts. It also replaced 80 per cent of virgin plastic used in delivery flyers with recycled plastic.

"As e-commerce continues to thrive in a post-pandemic world, we believe that we are well positioned to inspire sustainable consumer behaviour in unprecedented ways." 

Meanwhile, energy and urban development player Sembcorp set up its sustainability steering committee in 2012. Ms Ng Lay San:

"Initiatives over recent years have focused on embedding sustainability at the core of the organisation," said the firm's senior vice-president for group strategic communications and sustainability. This included establishing a climate change strategy as well as setting clear ESG indicators and targets and incorporating these into the performance scorecard of the senior leadership team."

Keppel also has a sustainability steering committee, chaired by chief executive Loh Chin Hua. A spokesman said environmental sustainability is also woven into the performance appraisal of senior management while an internal shadow carbon price is included when evaluating major investment decisions.