The Role of Accountants in Driving Business Sustainability in Singapore

Accountants Role

With the endemic on the horizon, the global economy has set its sights on achieving carbon neutrality. In Asia, Singapore has taken the reins in becoming the green finance hub regionally by launching the Green Finance Action Plan.

In this plan, the Monetary Authority of Singapore (MAS) has detailed several initiatives to drive green finance forward, which include improving climate-related disclosures and promoting greener solutions. In addition, several private entities have joined the movement to sustainability and have decided to launch their own projects.

Singapore Firms’ Green Finance Initiatives

In the mission to create a more sustainable economic environment, many companies have integrated their sustainability projects into their financing strategies. These include:

  • Olives Financial Initiative

    Under this initiative, OCBC, UOB, and DBS have offered three-year environmental, social, and governance (ESG) loans with interest rate discounts for ventures related to carbon management, climate risk, and workplace health. As a result, they encourage more businesses to venture into greener projects.

    Although this is the first initiative, the company plans on launching other sustainable projects in the future, according to the chief financial officer of Singtel. Through these initiatives, they plan to extend sustainability projects to their financial strategies to make a positive impact on the environment and society in general.

  • SP Group Green Financing Framework

    Under this framework, the SP Group has secured a green loan worth S$100 million to issue green financing instruments to fund sustainable projects in any of the four categories, mainly clean transportation, green buildings, energy efficiency, and renewable energy. Through this framework, lenders and investors can identify investment opportunities and green projects that are aligned with their existing sustainable investment approach.

  • GoGreenWithRazer Initiative

    An international gaming powerhouse, Razer has introduced their #GoGreenWithRazer movement to accelerate sustainability. Under this movement, they have several company initiatives like the Green organisation, Green Products, Green Investments, and Green Community. In all projects, their main focus is to nurture a greener lifestyle for their consumers, employees, and investors.

    In the post-COVID world, it’s evident that companies are gradually shifting their focus to more sustainable products and services. Through this, you can see the trajectory of the business landscape in Singapore leaning towards a greener, more sustainable future.

    However, apart from business leaders, accounting firms in Singapore also play a major role in driving this movement forward.

How Singapore Accounting Firms Propel Sustainability

Contrary to popular belief, the roles of accountants go beyond preparing financial statements and balancing books. In fact, they have the power to assist their companies in mitigating climate-related risks and promote sustainable goals. Here’s how:

  • They influence business practices

    Accountants are in the best position to drive transformational change in the company by determining areas where they can lessen their carbon footprint, thereby decreasing overall spending.

    For example, the simple act of optimising electricity and water usage in the office can reduce their utility bills. With this in mind, companies can be more motivated to implement conservation practices because they see how they can positively impact the company’s finances and the environment’s well-being in general.

    Therefore, the accountant’s role is to help the company understand how such environmental considerations can influence their business.

  • They verify sustainability reports

    Additionally, with more investors and stakeholders adopting the environmental and social performance metrics on top of financial performance, accountants are expected to consider climate change risks and monitor regulatory requirement updates to guide companies in making sustainable choices and verify sustainability reports.

  • They protect future costs of climate impact

    Part of the accountant’s responsibility is to assess environmental, social, and governance (ESG) costs and benefits in relation to business decisions. This means they have the ability to estimate the monetary value of the impact of climate change on the company.

    For instance, extreme heat or flooding caused by carbon emissions can increase the company’s future cost because they would have to consider expenses related to repairs, fixtures, and equipment replacements. To avoid incurring additional costs and protect the company’s finances, accounting services Singapore can provide sustainable solutions.

Conclusion

The role of accounting and outsourcing services has evolved throughout the years. More than keeping books and evaluating finances, they can now provide strategic advice to the company’s management with regard to addressing sustainability issues.

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