Background

On 9 July 2025, the Monetary Authority of Singapore released the Sustainability Report 2024/2025, which set out their strategy on climate resilience and environmental sustainability to strengthen the resilience of our financial sector to environmental risks, develop a vibrant sustainable finance ecosystem and build a climate-resilient investment portfolio.

Key Highlights

• Growth in sustainable finance: Strong increase in green, social, sustainability-linked (GSSSL) bonds and loans, reinforcing Singapore’s regional leadership.
• Shift to active climate strategies: MAS transitioned from passive to active management in its climate-related investment programmes to enhance responsiveness to risk.
• Portfolio decarbonisation: Corporate bond holdings are being reoriented toward issuers with lower carbon intensity.
• Operational emissions reduction: MAS achieved notable cuts in internal emissions through energy efficiency upgrades and greener outsourcing practices.
• Sustainability talent development: Significant investment in upskilling professionals to support green finance and ESG integration across the financial sector.

Regulatory Expectations

MAS emphasised that:

• Financial institutions should actively integrate climate risk management within investment and lending activities.
• Adopting active portfolio strategies enhances resilience to climate-related disruptions.
• Entities should measure, monitor, and reduce all relevant emissions, particularly Scope 2 and 3.
• Building sustainability expertise across the financial sector is essential to support ASEAN’s green transition.

What’s Next?

• Scaling up climate alignment: Expect a gradual pivot of MAS’ bond portfolios towards low-carbon issuers.
• Deeper institutional engagement: MAS will collaborate further with banks, asset managers, and insurers to bolster resilience and green finance capacity.
• Ongoing investments in ESG professional pathways: Continued funding and workforce shifts to sustain talent pipelines in ESG and sustainability.

How Can We Help?

Capital Governance assists fund managers by:

• Advising on emissions monitoring, reporting, and sustainability disclosures
• Organising ESG training tailored to fund managers, advisers, and board-level oversight…and more.

Contact Us today to discuss how we can provide the risk and compliance advisory solutions for you. Find out more here.