Orient Magazine Issue 84 - October 2021 - Page 44


Recent Webinars

Discover more webinars at britcham . org . sg / webinars
14 Sep 2021 : UK Outlook : Planning For a Smooth and Tax Efficient Move to the UK
Together with Select Investors , join us for a webinar as we discuss planning your tax as you consider moving back to the UK .
Series Partner :
23 Sep 2021 : Battery Storage For Asia
In this session , our Energy & Utilities and Sustainability Committees bring you a webinar on the growing opportunities to invest in , develop and finance the future of battery storage in the region .
28 Sep 2021 : The Future of Green Data Centres
In this session , our Built Environment , Energy & Utilities and Sustainability Committees bring you a webinar on the future of Green Data Centres and how this impacts Singapore ' s Green Plan and more .
29 Sep 2021 : Ready for 100 ? How the Pandemic has Impacted Singapore ’ s Preparedness for Longevity
In this session , Prudential Singapore as part of our Longevity Agenda Series as we discuss how COVID-19 has impacted health , wealth , work and relationships and more . RECENT WEBINARS
SPECIAL FEATURE: SUSTAINABILITY 45 PREPARING YOUR BUSINESS IN A POST-PANDEMIC WORLD - THE ESG LENS How boards can drive more robust climate risk disclosures Preparing Your Business in a Post-Pandemic World – The ESG Lens Boards can help address gaps in the quality of climate risk disclosures by focusing on three key areas. Thinking sustainability is good for the planet and your P&L The pandemic has turned the spotlight on many critical sustainability issues we face alongside the growing concern about how these challenges might accelerate in the future for businesses. In times like this, company leadership during this Covid-19 crisis should sharpen their focus on the adoption of environmental, social and governance – the risks and opportunities. ESG is heading mainstream as the growing interest from the investor piques beyond robust risk management but practices, progress and challenges that intertwine the environment, health and economy. There is a noticeable trend that smaller, medium-sized busi- nesses are seeing the benefits of being green conscious that open new doors for growth. The big agenda on sus- tainability is no longer limited to listed companies. Nexia TS speaks to sustainability professionals and business leaders at a recent webinar titled, 'The 3Ps of Preparing Your Business in a Post-Covid World'. "As leaders, we need to prepare our business to cope in a post-Covid world – in terms of mentally, strategi- cally and sustainably," said Henry Tan, Group CEO & Chief Innovation Officer of Nexia TS. "If we did not react to the challenges arising from this pandemic to make a better change to our busi- ness, to strive and do better than the last, this pandemic would have gone to waste." While most are spurred to invest responsibly however often baffled by the industry terms bodied around by professionals and clients alike. Through the lens of an investment professional, Fergus Boyd, Investment Management Partner of UK accounting firm, Smith & Williamson, said: "Investors are taking a holistic approach to investment anal- ysis, where material factors – both ESG and traditional financial information, are identified and assessed to form a responsible investment decision." The distinct differences exist based on your investment needs evolving beyond traditional financial measures that may have a material impact on the perfor- mance of that investment. Fergus also notes that there has been an increase of younger generations emphasizing the importance of environmental and social impacts, and more clients are de- manding transparency about how and where money is invested. It goes to show that ESG is the business plan for the planet. Embracing sustain- ability is not a distant goal but a journey that strengthens the resilience of our communities and businesses. A com- mon struggle that companies may face while attempting to identify these goals are the key material topics to report on, cited Pamela Chen, Head of Internal Audit, Nexia TS. She adds, "ESG revolves around the company's value – what drives the company. An example of a value driver would be people – talent. This cascades down to your employee engagement which translates as a social topic in your sustainability framework." On the other hand, accountability is key to sustainability claims where compa- nies can't just talk the talk and not walk the walk. The ability to substantiate the claim and demonstrate clarity in such disclosures are vital to investors. Gre- enwashing is becoming a tipping point for some companies who are exposed to making false or misleading claims on being environmentally friendly than they really are. Instead of slowing our progress towards achieving sustainability goals, verifica- tion mechanisms are essential to avoid deceptive marketing. "ESG is all about mindset," said Daphne Ng, Co-founder of Dedoco. "The 's' (social) component is in relation to your stakeholders – cus- tomers, investors and employees. This will set the tone on how a company can organise their ESG strategies." The rise in caring for the greater good matters to everyone in the planet. It is no longer an option but something that all of us cannot afford to ignore. ABOUT THE COMPANY Founded in 1993, Nexia TS today is rec- ognised as an established accounting and advisory firm. Headquartered in Singapore, the firm has strong presence in various countries across the region. Nexia TS Shang- hai is a one-stop centre providing advisory services for foreign-invested enterprises in China. NTS Malaysia and NTS Myanmar provide a full suite of corporate advisory ser- vices for clientele with operations and new foreign investments in the respective coun- tries. Being an independent member firm of Nexia International also means that we have more than 35,400 staff serving clients at 752 offices in 128 countries. It is ranked as the 8th largest international accounting and consulting network. For more information, visit www.nexiats.com.sg. Simon Yeo EY Asean Climate Change and Sustainability Services Leader; Partner, Assurance, Ernst & Young LLP Climate risks are moving up the boardroom agenda as com- panies face increasing pressure to tackle climate change more proactively. Investors are increasingly interested in how organizations plan to contribute to a decarbonized economy and would reconsider or even walk away from investments based on climate risk. Likewise, employees, customers and other stakeholders expect corporate leaders to lead the way in addressing climate change. Clearly, businesses need to widen their view of both physi- cal and transition climate risks, and the opportunities that may arise from responding to these risks. Board leadership is critical for guiding organizations in decarbonizing their business models and supply chains. There are three ways in which boards can drive more robust climate risk disclosures and position the company to better navigate climate risks and leverage opportunities. With the fast-growing urgency of climate action, businesses must understand their climate risks and opportunities, speed up their implementation of climate strategies and communi- cate their performance. Amid this shift, companies continue to make progress in both the quality and coverage of their climate-related financial disclosures, according to the June 2021 EY Global Climate Risk Disclosure Barometer. The re- search draws on companies’ public disclosures — such as in annual reports, sustainability reports and CDP responses — on the uptake of the Task Force on Climate-related Financial Disclosures (TCFD) recommendations and covers more than 1,100 companies across 42 countries. Connect climate reporting more directly with risks and opportunities But the quality of these disclosures still lags behind cov- erage of the TCFD recommendations, and Singapore is no exception. An analysis of more than 90 listed and non-listed companies across 11 sectors in Singapore found that while the companies’ disclosures covered 45% of the TCFD recom- mendations on average, the average quality score across the organizations was only 18% of the maximum quality score across the 11 recommendations. These findings suggest that companies in Singapore still find it challenging to come to grips with their exposure to climate risks and act on it. The research found that many organizations still lacked reporting on metrics directly connected to risks. While dis- closing the company’s Scope 1 and 2 emissions (i.e., direct emissions from controlled sources and indirect emissions from purchased electricity respectively) is critical, it is equally important to disclose metrics that are used to assess its exposure to physical risks like the weighted average car- bon intensity metric, which measures exposure to carbon-in- tensive companies. A more rigorous assessment may be required to develop the climate-related financial disclosures that drive behavioral change. Boards should assess whether sufficient coverage is given to both the risks and opportuni- ties in the company’s climate reporting to allow the busi- ness to better assess the potential impact on the corporate strategy. Another common pitfall is that companies may be limiting climate risk assessments to certain parts of the business and only including qualitative analyses. Clearly, there is a need to widen the scope of assessment as physical and transition risks from climate change can have an impact on SPECIAL FEATURE: SUSTAINABILITY HOW BOARDS CAN DRIVE MORE ROBUST CLIMATE RISK DISCLOSURES