This webinar discussed the role of the finance sector in driving more responsible business practices and investments in support of a sustainable and inclusive post-Covid recovery, as well as in reducing social inequalities.
ISEAS-SPF ASIA IMPACT DIALOGUE WEBINAR SERIES
Enhancing Responsible Business in Southeast Asia
Wednesday, 23 September 2020 – The ISEAS – Yusof Ishak Institute in partnership with the Sasakawa Peace Foundation held a webinar on “Delivering Post-Covid Recovery and Fighting Inequalities by Sustainable Finance”. The webinar is the fourth session in a six-part ISEAS-SPF Asia Impact Dialogue Webinar Series on “Enhancing Responsible Business in Southeast Asia”.
Moderated by Senior Fellow of ISEAS – Yusof Ishak Institute, Dr Casey Lee, the webinar featured the insights of Dr Youngho Chang (Singapore University of Social Sciences), Mr Sylvain Augoyard (WWF-Singapore), and Dr Sukich Udindu (SEAMEO Regional Center for Sufficiency Economy Philosophy for Sustainability, Thailand). The speakers presented their discussion of the role of the finance sector in driving more responsible business practices and investments in support of a sustainable and inclusive post-COVID recovery, as well as in reducing social inequalities.
The webinar began with Dr Youngho Chang’s presentation on the role of Credit Guarantee Scheme (CGS) in alleviating the credit constraints faced by small and medium enterprises and start-ups in Southeast Asia. Addressing such funding gaps can nurture the growth of start-ups. Drawing from his insights on the seven largest economies in the region – Indonesia, Singapore, Thailand, the Philippines, Vietnam, Malaysia, and Myanmar – Dr Chang emphasised the importance of multi-level partnership that involves government, banks, insurance companies, technology companies, trade associations, and supranational organisations such as the Asian Development Bank in developing a successful CGS eco-structure in Southeast Asia. He underscored the importance for government institutions to assist borrowers (small and medium enterprises such as start-ups) by mitigating their credit risk exposure. In developing and finetuning existing CGS structures, Dr Chang suggested that policymakers could consider developing a credit guarantee scheme aimed at targeting innovative start-ups that have not been able to access sufficient bank loans nor attract equity financing. While the success and sustainability of a CGS depends largely on the right mix of partial guarantee coverage ratio and risk-based floating guarantee fee. Dr Chang recommended that government should also fine tune its support for CGS during periods of sustained economic distress, such as COVID 19 pandemic.
In his presentation titled “Role of Central Banks and Regulators, and How Finance can be a Force for Good”, Mr Sylvain discussed the importance of green financing, banks, and regulators in paving sustainable pathways in Southeast Asia. Using the examples of green financial products such as sustainability-linked bonds and loans and bankable nature-based solutions (BNS), Mr Sylvain emphasised how banks could be a force for good within their financial mandate. He said that the current Covid-19 pandemic presents new socio-economic opportunities in promoting sustainable banking measures and regulations in Southeast Asia that are crucial in alleviating and mitigating climate-related risks. In closing, Mr Sylvain emphasised the importance of multi-sectoral partnership between companies, financial institutions, conservation organisations, and local stakeholders to develop BNS that could pave the way towards more sustainable and responsible business practices in Southeast Asia.
Dr Sukich Udindu shared his insights about the recent emergence of Corporate Social Responsibility (CSR) networks led by businesses and investors in Southeast Asia. Examples of these networks include the ASEAN CSR that comprises businesses and investors from Indonesia, Malaysia, Singapore, Thailand and the Philippines, as well as the Thailand Responsible Business Network that comprises multi-sectoral partnership between the government, investors, and start-ups that have been driving more sustainable and responsible business practices in Thailand and Southeast Asia at large. Dr Sukich emphasised the importance of multi-dimensional ethical practices and benefits centred on “the 3Ps” – people, planet, and profit – that should lie at the heart of all business practices. He said that these practices have become even more urgent in the drive towards a more sustainable and inclusive post-Covid future in Southeast Asia.
The webinar concluded with a Question and Answer session. The online audience engaged the speakers on a variety of issues surrounding the key challenges of developing rigorous taxonomies for green financing practices and new ventures as opposed to expanding existing ventures; recommendations for green financing practices in Southeast Asia; and the gap in green financing practices between Southeast Asian countries and other more developed green finance hubs in East Asia and Europe.