In recent times, conscious consumerism and planet-friendly practices have garnered global attention. Many businesses are driving sustainability and carbon-zero efforts to ensure they reduce negative impact on the communities and the environment because, whether we like it or not, these may potentially contribute towards environmental, social, and governance (ESG) issues.

This has also led to greater interest in ESG – not just among investors, but also policymakers and key stakeholders. As the world continues to face climate change and worsening pollution amidst other environmental issues, many of us strive to play our part in protecting the planet by reducing our carbon footprint. 

What Is ESG Investing?

Environmental, Social and Governance (ESG) criteria is used to benchmark the ethical conduct of companies and countries, and their ability to positively impact the environment and community that we live in, for a more sustainable and socially responsible future.

ESG Investing operates within a set of standards that prioritises optimal environmental, social, and governance factors or outcomes. It is often regarded as a method of investing sustainably because considerations for the environment, human well-being, and the economy must be made.

• The environmental criteria assess how a corporation protects the environment through practices like corporate policy addressing climate change. Matters such as waste, pollution, carbon footprint, and contribution of toxic chemicals must be considered.

• The social criteria consider how the company maintains connections with its employees, suppliers, consumers, and the communities in which it operates. Subjects like racial diversity, inclusivity, and employees’ health and safety fall in this category. It goes so far as to include how businesses advocate social good and human rights.

• The governance criteria observe how the company’s board and management drive positive change. Matters such as executive pay, diversity in leadership, and how well the leadership responds to and interacts with shareholders are among the factors covered in the area of governance.

Build A Sustainable Foundation for the Future with OCBC

Although profit still plays a large role in what drives business decisions, OCBC believes that the impact of the decisions made today will greatly affect the future of the world, society, environment and ecosystems. In driving change for a better tomorrow, OCBC provides various ESG solutions that align with sustainability.

ESG Investing Solutions

A common misconception in the sustainability journey is that returns are necessarily compromised when investing in ESG-integrated investments. In reality, all risks and returns need to be analysed as with any other investment.

With ESG investing, individuals and businesses are motivated to pursue the best corporate and management practices while also seeing to the social well-being of the community and the conservation and preservation of the environment. When these factors are equally considered, they can result in favourable long-term financial success based on the performance of the investment.

Below are two ESG-integrated investments offered by OCBC:

Unit Trusts – Portfolios of equities and/or bonds for which environmental, social and governance factors have been integrated into the investment process. Trained and experienced fund managers will professionally and actively manage your investment. This is also a popular method commonly adopted to diversify one’s portfolio.

Treasury Products – A low-risk investment solution linked to sustainable companies or outcomes. 

ESG Financing Solutions 

In driving their commitment toward green financing alongside other ESG initiatives, OCBC Bank works in partnership with solar panel providers to encourage the use of renewable energy. This solution allows for a seamless integration of sustainable practices for households and businesses while also providing a means to cut back on electricity bills and consumption.

OCBC offers a variety of ESG financing solutions, such as Solar Panel Financing, an option offered to eligible OCBC customers with a home loan/financing. Customers can choose to top-up or refinance their loans or financing for solar panel installations. 

Alternatively, existing OCBC credit cardmembers can opt for 0% Instalment Payment Plan (IPP) or Easy Payment Plan (EPP) if they wish to install solar panels. 

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As ESG continues to garner attention from investors, ministries, businesses, and the public, it is evident that people are interested in kinder, better practices towards communities, the environment and within an organisation. 

Investors can potentially gain attractive returns on their investment, depending on its performance in the market. Besides that, embracing ESG investing means investors are playing a role in helping the environment, supporting ethical companies and good governance, and making a positive social impact on unfairly treated communities.

Visit the website to learn how you can begin your journey in ESG investing and financing with OCBC.

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• ESG Financing
• ESG Investments
• OCBC Bank
• Sustainable Financing