Climate-Related Scenario Analysis and Green Finance Guides to Support Businesses in their Sustainability Journey

2 mins read

13 April 2023

  • The guide on climate-related scenario analysis helps businesses understand the impact of climate-related risks
  • The green and sustainable finance guide provides a roadmap for SMEs to obtain funding for their sustainability projects 

In support of Singapore’s transition to a green economy, a key pillar of Singapore Green Plan 2030, the Institute of Singapore Chartered Accountants (ISCA) has issued two publications to guide businesses on their sustainability journey. 

ISCA’s scenario analysis guideprovides direction to businesses in analysing different climate-related scenarios. This is increasingly important for businesses to understand and manage climate risks, make informed decisions, enhance resilience, and identify opportunities to create value in a low-carbon economy.

Green & Sustainable Finance: Guide for SMEs provides a roadmap for small and medium enterprises (SMEs) to access opportunities in green and sustainable finance. It features examples of local companies which have successfully tapped sustainable finance to future-proof their businesses.

Mr Teo Ser Luck, President of ISCA, said, “These publications are in line with ISCA’s goal to equip finance teams with the knowledge and skillsets to leverage sustainability opportunities. This will help position the accountancy profession as a sustainability champion and key driver of corporate sustainability. The two guides will help businesses with two critical aspects as Singapore transitions to a green economy – how to manage the impact of climate-related risks and how to fund their green initiatives.”

Climate-Related Scenario Analysis Shows Impact of Climate-Related Risks

Climate-related scenario analysis helps companies understand how climate change may impact their business and identify opportunities to make their operations more resilient. This can be a complex process that requires careful consideration of various factors, including data availability.

This guide offers a practical approach to help businesses navigate this challenging process and includes suggestions of common climate risks and sources of scenarios.

The guide also features learning experiences and insights from Wilmar International Limited and CapitaLand Investment Limited, two companies which have commenced climate-related scenario analysis as part of their sustainability reporting.

How SMEs Can Access Green and Sustainable Finance?

With more than 90% of businesses in Singapore being SMEs, they are crucial to the nation’s transition to a low-carbon economy. However, many SMEs are not aware of the range of sustainable finance options available to them, or do not fully understand the requirements and benefits of such finance. This can make it difficult for them to access appropriate financing to achieve their green goals.

Green & Sustainable Finance: Guide for SMEs aims to provide a roadmap for businesses, in particular SMEs, to access opportunities in green and sustainable finance and fund their sustainability projects. Featuring case studies of local companies, such as Dyna-Mac Holdings Ltd which tapped on sustainability-linked loans to embark on initiatives to achieve various sustainability targets, the guide outlines the various principles and frameworks of green and sustainable finance, and highlights the relevant government grant schemes.

This guide also explores the role of accountants in leading their companies’ green agenda. With green and sustainable finance gaining prominence, accountants can facilitate the understanding of how such financing can enable a company’s transformation to a sustainable business.

Other publications ISCA has issued on corporate sustainability include Sustainability – Jobs and Skills for the Accountancy ProfessionISCA Climate Disclosure Guide – Taking First Steps Towards Climate-related Disclosures and Addressing Climate-Related Risks in Financial Statements and Audits of such Financial Statements. ISCA also provides several courses and events on corporate sustainability, including on-demand online courses via its ISCAccountify learning platform.

For the ISCA Climate Disclosure Guide Vol 2: First Steps in Conducting Climate-Related Scenario Analysis, click here. For Green & Sustainable Finance: Guide for SMEs, click here.