ESG in Singapore: A top priority for growing businesses

Issues that can drive business risk include worker rights, gender and racial equality, child labour and environmental effects on people’s health. Companies should also support employee wellbeing and provide valuable training opportunities. This helps attract and retain talent and offers a range of flow-on benefits (e.g., better productivity and efficiency) for improved business outcomes.

In addition to mitigating ESG risk, Singaporean businesses can also build their resilience by being first movers in the ESG space and making use of new opportunities the market poses for companies.

“If a company does not understand the ESG landscape, they might miss all the opportunities available,” Tina says. “For example, some companies are introducing plant-based products to capture new clients. Or there may be opportunities for expansion, new technology or market streams.”

From a social perspective, a strong corporate governance framework is crucial for businesses as it empowers them to establish and enforce ethical standards, ensuring fair work conditions and promoting transparency across their supply chains to responsibly monitor and protect the rights of workers. This strategy benefits not only your business but society at large.

Sustainable practices can benefit Singaporean companies in various ways, depending on the nature of the business and its industry.

Some prominent practices include:

In today’s rapidly changing world, the benefits of sustainable practices and diversity and inclusion are more interconnected than ever before. Embracing a diverse workforce and fostering an inclusive environment presents a valuable opportunity for businesses to perform better and be more innovative.

“Without diversity, people think alike and have the same or similar views, so there’s little to no creativity,” Tina explains.

Diversity and Inclusion (D&I) is a positive social factor for employees, while it can be a governance strength for board members.

“The SGX emphasises that the boards have to be diverse – this is mainly to champion the idea that having the right mix of individuals with the right education, background and experience level is important for ensuring a business is well run,” Tina says.

Furthermore, embracing D&I helps to create an open workplace culture that is accepting of differences and more adaptable to change in an uncertain world.

ESG is now shaping business decisions to a significant degree. Whether a company is buying or investing in a business or improving parts of its own group, ESG considerations are now a standard part of commercial and financial due diligence processes.

Primary ESG considerations commonly include:

• climate change and its potential impacts on the business (e.g. the threat of natural disasters and drought);
• resource depletion and the limits it may place on resource consumption within a business’ operations;
• possibilities for emissions reduction and the conservation of resources (like water);
• the potential to adopt a circular business model that enables reuse and recycling to maximise resource efficiency and minimise waste; and
• the importance of good corporate governance, a hallmark of well-run companies that builds trust among consumers and investors while reducing compliance risk.

To ensure business decisions consider key ESG factors, leaders should develop a comprehensive ESG strategy and engage with stakeholders to promote open dialogue. “They also need to invest in sustainable business practices and monitor and report on their progress,” Tina says.

The assistance BoardRoom provides as part of our end-to-end ESG service includes (but is not limited to):

• undertaking a materiality assessment to identify which ESG issues your company should respond to and report on;
• conducting a gap analysis to evaluate compliance with stakeholder expectations;
• gathering valuable ESG data with our innovative, easy-to-use ESG Access platform; and
• setting data-driven key performance indicators and targets for ESG performance.

We provide full ESG life-cycle management for all types of businesses, from growing SMEs new to ESG to large multinational corporations wanting to take their sustainability practices to the next level.

Wherever you are on your ESG journey, we are ready to assist.

Our ESG professionals can also help you enhance your ESG performance in the eyes of key stakeholder groups through robust, efficient sustainability reporting.

Public and private companies alike should adhere to globally recognised frameworks to ensure their sustainability reports meet stakeholder expectations.

Publicly listed companies must now disclose their ESG management in line with the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations. Many businesses also follow the Global Reporting Initiative Standards in their reporting.

With our guidance, you can confidently use the best ESG frameworks and methodology for your business.