The Singapore Sustainable Finance Association (SSFA) has launched a new publication titled “Guidance for Leveraging the Singapore-Asia Taxonomy in Green and Transition Financing.” This guidance aims to address practical challenges faced by financial institutions and corporates in Southeast Asia when applying the Singapore-Asia Taxonomy for Sustainable Finance (SAT) to structure credible green and transition financing.
Introduced by the Monetary Authority of Singapore (MAS) in December 2023, the SAT is the first multi-sector taxonomy globally to include a dedicated transition category. It outlines criteria for activities that contribute to climate change mitigation across eight sectors. The SSFA’s latest guidance seeks to enhance the SAT’s utilisation by providing insights on data availability, interim thresholds, grandfathering provisions, entity-level transition plans, and interpreting amber categories.
The guidance also offers preliminary advice on referencing the SAT when full alignment is not feasible, addressing situations where projects cannot meet all criteria due to external factors. Drawing from over 20 industry members’ insights, the guidance aims to translate complex requirements into actionable steps, promoting consistent application and unlocking financing opportunities.
Gillian Tan, Assistant Managing Director at MAS, praised the handbook, stating it “sets out practical and industry-agreed approaches” to help navigate challenges in green and transition financing. Jeong Yoon Mee, SSFA Taxonomy Workstream Co-lead, highlighted the guidance’s role in unlocking financing for transition activities, a “critical yet often misunderstood area.”
The SSFA plans to further support the SAT’s adoption by developing a digital FAQ repository and a course curriculum to provide training and resources. This initiative aims to strengthen sustainable finance practices in the region, supporting a transition towards a net-zero future.
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