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Deutsche Bank has established an environmental, social and governance (ESG) Centre of Excellence (COE) in Singapore on May 20.
The ESG COE will work across the bank’s divisions, focusing on the execution of ESG transactions, new product development and advisory services.
The centre will develop new products addressing gaps in the ESG market such as impact monitoring, data management and payments to unbanked communities.
The ESG COE will house a “sizeable” team with deep experience with ESG. The team will work with coverage and product teams to implement activities and programmes including conducting ESG transactions across all business divisions, a fellowship programme for students at top global MBA programmes, internship programmes, as well as policy seminars.
“The transition of Asia towards sustainable practices requires ESG transaction models, products, solutions and regulatory measures which meet international standards while supporting on-the-ground realities in Asia. By establishing this ESG Centre of Excellence in Singapore, we aim to set standards for evidence-based, data-driven transactions which can substantiate ESG impact and support sustainable growth,” says Deutsche Bank’s head of ESG for Asia Pacific Kamran Khan, on the opening of the ESG COE.
“MAS strongly supports the establishment of Deutsche Bank’s Asia Pacific ESG Centre of Excellence in Singapore. It is a welcome addition to Singapore's growing sustainability and green finance ecosystem. The Centre of Excellence will leverage innovation to accelerate Asia’s transition to a sustainable future. The COE’s goal to facilitate industry knowledge transfer will help to deepen the pool of specialized talent and capabilities in Singapore,” says Gillian Tan, assistant managing director (development and international) at the Monetary Authority of Singapore (MAS).
In a separate statement, a survey conducted by the bank found that private-banking clients are increasingly taking ESG factors into account when it comes to investing, due to the Covid-19 pandemic.
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The pandemic, says the bank, has raised their clients’ desire to invest in line with their values and to manage potential risks in their portfolios.
The survey was conducted amongst the bank’s 2,130 clients from 10 countries around the world, aged between 26 to 70 years old by the Chief Investment Office (CIO) of Deutsche Bank’s International Private Bank (IPB).
Of the figure, some three quarters said that their investments should have a “positive impact”. Of those, 57% said that the Covid-19 pandemic had contributed to that view.
About 51% of those surveyed said that investing based on ESG factors can help manage risk in their portfolio, while 74% said that the pandemic had highlighted the importance of managing risk.
Of the factors, around half of the respondents recognised the need to incorporate biodiversity loss into their decision-making process due to its likely role in causing ocean depletion, land degradation and accelerating climate change, with 11% of those highlighting it as the most important environmental factor.
“ESG has become more and more important in investment decision-making,” writes Christian Nolting, Chief Investment Officer, in a report on the survey and the role of biodiversity risk in investments.
“Biodiversity underpins many environmental, social and governance systems and biodiversity loss is therefore likely to be an increasing focus of public and investor concern,” he adds.
The survey also found that women were likely to focus on the social pillar of ESG and that their investments should have a positive impact.
Millennials tended to be more focused on ocean pollution than their older counterparts.
Around 54% of small- and medium-sized enterprises (SMEs) regard climate change as the main ESG issue, although only 26% of the 54% have a dedicated ESG strategy.
Sustainability is a core pillar in the bank’s transformation strategy. The bank adds that it has committed a total of EUR200 billion in its total volume of sustainable financing and investments by the year 2025.
