KUALA LUMPUR, 26 October 2019 – An increasing number of Asian issuers and investors are starting to widen their horizons to include the impact of environmental, social and governance (ESG) issues in their considerations, a new report from HSBC says.
HSBC’s Sustainable Financing and Investing Report 2019 showed that in Asia 86% of investors and 84% of issuers said ESG factors were ‘very’ or ‘somewhat’ important to them, close behind the global figure of 94% and 93% respectively.
HSBC in Malaysia had taken launched the FIRST-ever Environmental, Social and Governance (“ESG”) Islamic Structured Product in the Malaysian market.
This is also in line with Bank Negara Malaysia’s Value-based Intermediation (“VBI”) initiative which seeks to ensure that the development of the Malaysia financial market is consistent with the current focus on the global sustainability agenda.
In addition, HSBC Amanah Malaysia Berhad (HSBC Amanah) had launched the world’s first United Nations (UN) Sustainable Development Goals (SDG) sukuk. This reflected HSBC Amanah’s commitment to financing projects that benefit communities and the environment in line with HSBC Group’s responsibility to help finance global sustainable development.
According to HSBC, values are the most important driver for investors and issuers in Asia to care about environmental and social issues. 58% of Asian issuers say they care because it aligns with their values as an organisation, and 62% of investors because it is right to care about the world and society.
Jonathan Drew, head of sustainable finance for Asia-Pacific at HSBC said, “Environmental and social factors are becoming priorities for both issuers and investors in Asia, and there is increasing recognition that these factors are drivers of yield and value.”
HSBC has delivered a range of sustainable finance transactions in Asia-Pacific in 2019. Landmark deals include ICBC’s USD3.15 billion Greater Bay Area green bond, the first green loan compliant with the Green Investment Principles for Belt and Road by ICBC, Hong Kong’s inaugural sovereign USD1 billion green bond, the first green loan in Singapore for Ho Bee Land, Macquarie University’s first sustainable bond from a university, the world’s first green convertible bond from a real estate company, Link REIT, and the first UN Sustainable Development Goals (SDG) sukuk for HSBC Amanah Malaysia.