“No ESG, no Taiwan”: Cathay Sustainable Finance and Climate Change Summit calls for Taiwan’s sustainability efforts to align with international standards Yahoo Finance”No ESG, no Taiwan”: Cathay Sustainable Finance and Climate Change Summit calls for Taiwan’s sustainability efforts to align with international standards Yahoo Finance”No ESG, no Taiwan”: Cathay Sustainable Finance and Climate Change Summit calls for Taiwan’s sustainability efforts to align with international standards Yahoo Finance
Impact Investing Forum 2022
London. April 28-29, 2022.
TAIPEI. December 27, 2021 /PRNewswire/ — The 2021 Cathay Sustainable Finance and Climate Change Summit saw record attendance via the online stream. Over 1,500 people and 800 companies and organizations registered for the summit, four times more than in 2020. The event attracted 76% of Taiwan’s stock exchange value. This includes 39 of the 50 most valuable Taiwanese corporations. Companies that register also account for 51% total carbon emissions in Taiwan. The Summit provided continuing education credits to board directors and supervisors of listed companies. The event was attended by 247 supervisors and board directors representing 363 companies. This year was also the first year that six internationally recognized ESG experts were invited to participate. Key representatives from Taiwan’s government, industry, and academia were also present, making the event a valuable platform for communication about Taiwan’s ESG trends.
News photo 1. On December 7, 2021 Cathay Sustainable Finance and Climate Change Summit were unveiled. Chairman Tien-Mu HUANG, FSC Chairman, and Chairman Hong-Tu TSAI, Cathay FHC Chairman, spoke together in support of sustainable finance and climate change issues.
Hong-Tu TSAI, Chairman of Cathay Financial Holding Co., Ltd., noted that 2022 will be Cathay’s 60th Anniversary. He also said that he has a deep understanding of the importance of sustainability and profitability for a company’s long-term survival. Cathay’s sustainability efforts include organizing the Summit for the fifth consecutive year. Cathay has used its influence to press companies to respond to CDP. This is the largest platform for disclosing carbon emissions information in the world. Cathay had conducted 670 in-depth engagements, and 65% percent of companies that Cathay successfully engaged as the lead investor increased their CDP scores the year after 2020. “We have called for immediate and sustainable actions from both borrowers and investees through this Summit.” Hong-Tu said that Taiwan will perform well and that this will be recognized internationally. Cathay has also achieved many ESG milestones in Taiwan. Cathay United Bank, Cathay Life Insurance, and Cathay Century Insurance were the first to comply with sustainability standards, such as the UN’s Principles for Responsible Investment, Principles for Responsible Banking, and Principles for Sustainable Insurance. Cathay is the only Taiwanese bank to participate in several international climate-related initiatives including Climate Action 100+, the Asian Utilities Engagement Program, and Climate Action 100+. Cathay applied to join RE100 and pledged that all of its Taiwanese business operations will use 100% renewable energy by 2030 and achieve net zero activities by 2050. The environmental issue has evolved from the Carbon Border Adjustment Mechanisms (CBAM), to COP26 resolutions. It has become a major economic, political and societal problem. Chairman Tien-Mu HUANG, Financial Supervisory Commission (FSC), stressed that policy implementation is crucial to climate change mitigation and sustainable financing. He highlighted five key points. First, consistent targets. Second, adjustments must be made to accommodate ongoing change. Third, government policy must follow principles of fairness, proportionality, and assistance must be provided to those with less resources and disadvantaged groups. Fifth, goals must be achievable. Companies must develop viable strategies and be responsible participants in sustainable finance and climate change mitigation. While climate change mitigation and sustainable finance are a high-level goal, it offers an opportunity for companies to make organizational reforms. For example, performing a carbon footprint inventory is an important decision for a corporate board,” said Tien-Mu HUANG.Director-General Brenda HU of the FSC’s Department of Planning stated that in order to firmly establish sustainable finance practices, the FSC is studying the EU’s approach and drafting a standardized taxonomy of sustainable activities. It will first be tested in three major industries–manufacturing, construction and real estate, and shipping and warehousing–providing the financial industry with a basis for assessing investment and financing opportunities. The taxonomy covers six major environmental goals: climate change mitigation, climate adaptation, water and maritime resources, circular economy and pollution prevention, as well as social protections (of worker rights, human rights, and social developments). Business activities must satisfy at least one environmental goal and not hinder other goals, while also achieving social protection–only then are they in line with sustainability.Climate action strategies to leverage companies’ transition to green operationsDeputy Minister of Economic Affairs Wen-Sheng TSENG said that the Ministry of Economic Affairs will help companies reduce carbon emissions by first designating carbon footprint verification tools. It will also create regulations for wholesale purchases of commercially renewable energy. This is currently only available to Taiwan’s state-owned utility. This will allow more companies to purchase low-carbon energy. Lin-Yi TSAI (Director of the Climate Change Office at Environmental Protection Administration) stated that the EPA will simplify administrative processes to assist small and medium-sized enterprises in conducting carbon footprint inventories as a response to the European Union’s CBAM. The Climate Change Response Act currently being drafted will include a carbon tax, with rates taking into consideration the level of domestic economic development and using a phased approach to implementation.International sustainability standards are gradually taking shape. Robert G. ECCLES (Visiting Professor of Management Practice, University of Oxford) noted that the International Sustainability Standard Board, (ISSB), was established during COP26. It will establish ESG information disclosure standards for global markets and provide a framework for corporate sustainability reporting. Rebecca Mikula Wright, CEO of Asia Investor Group on Climate Change (AIGCC), stated that companies should establish a timeline and approach to achieving net zero emissions. 14 of the 33 Asian companies with the highest carbon emission have committed to becoming net-zero or carbon neutral by 2050. Hon Hai Technology Group (Foxconn), Formosa Petrochemical Corporation and China Steel Corporation are some of these companies. They all shared their strategies during the Summit. Major carbon emitters accelerate carbon reduction efforts. Taiwan declared that it would achieve net zero emissions by 2050. This means that companies need to take action at a faster pace. China Steel Corporation President Shyi Chi WANG said that he was aware of the pressure from “three Carbons” since last year’s end: carbon neutral, carbon taxes and the EU’s Carbon Border adjustment Mechanism. He has been more active in carbon reduction efforts. China Steel will reduce carbon emissions by 1% each year until 2030, in the short-term. China Steel will work with academia to develop and research necessary technologies and plan to allocate resources to use hydrogen as an energy source. It plans to become carbon neutral by 2050. Sang-Chih LIN, President of Formosa Plastics Group, stated that Formosa had adopted the 5S method for workplace organization in the 1990s (sort, set up in order, shine standardize, sustain) as well as a policy to eliminate oil, water, and gas leaks. It has also adopted circular economy practices, which include water, energy, and waste recycling across all Group companies and production sites. Its 2020 carbon emissions represented a 15.7% decrease from 2007’s peak. Using 2007 levels as a baseline, Formosa plans to reduce its carbon emissions by 20% and 35% by 2025 and 2030 respectively. The Summit also featured Taiwanese representatives who shared their experiences in promoting ESG and a transition towards low-carbon operations. Sinyi Realty Inc. founder Chun-Chi CHOU said that Sinyi has purchased a small island in Malaysia where it is planting trees, marine algae, and restoring coral reefs. It has provided outstanding carbon credits to its parent company to help achieve net-zero emissions by 2030. TSMC is the first semiconductor company in the world to join RE100. It has also set 2050 to achieve net-zero emissions, and create a sustainable supply network. Hon Hai also set 2050 to achieve net-zero emissions and made ESG a key performance indicator in both supplier evaluations and internal performance assessments. No ESG = no money. Taiwanese industries were a key player in the global supply chains and recognized customers’ high ESG expectations from the beginning. The transition to sustainable development is not a choice that companies have, but an inevitable outcome. Hong-Tu TSAI said that the global supply chain declared “No ESG no business”, while financial industry called for “No money, no ESG”. Both convey that the transition to sustainable development is not a choice that companies can make, but an inevitable outcome.
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