The Monetary Authority of Singapore
("MAS") recently completed its
consultation on a set of three proposed Guidelines on Environmental
Risk Management for banks,1 insurers,2 and
asset managers ("AMs")3
respectively (collectively, financial institutions
("FIs")). The guidelines are part of the
MAS's Green Finance Action Plan to become a leading global
centre for green finance, which was announced last
year,4 and which aims to inter alia build financial
system resilience to environmental risk.5 This update
puts the guidelines in context and outlines the proposed
requirements.
Environmental Risks and Opportunities
Environmental risk may be presented in the forms of physical
risk (eg, business disruption and damage to property caused by
acute impacts such extreme weather events; and decline in labour,
capital, and agriculture productivity caused by chronic impacts
particularly from increased temperatures, sea levels rise, and
precipitation) and/or transition risk
