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The ESG Phenomenon - United Overseas Bank

Editorial Staff, 25 November 2020

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We gather developments and commentary in and around the ESG investment space.

United Overseas Bank
United Overseas Bank yesterday announced that it has launched the UOB Smart City Sustainable Finance Framework, which it said was the first dedicated financing framework by a bank in Asia to make it easier for companies to get sustainable financing for building “smart cities.”

“Smart cities,” according to one definition, use data and modern communications technology to make urban areas more pleasant to live and work in, doing less damage to the external environment. They collect data through wired and wireless networks from citizens, devices, buildings and assets to improve efficiency. Critics sometimes fret that they may also encroach on personal privacy.

UOB said that its finance framework sets out the criteria the bank's corporate and institutional clients must meet when accessing a range of products, from green or sustainability-linked loans and trade finance facilities to other sustainable banking products. Businesses must show how their activities promote a better quality of life for residents through the use of renewable energy, green building construction, improved energy efficiency, green transport, sustainable water and waste management and/or climate change adaptation.

"The United Nations estimates that $2.5 trillion is required annually for developing countries to bridge the financing gap in achieving the Sustainable Development Goals by 2030. Financial institutions can and must play a part, together with governments and businesses, to help channel more funds to sustainable development,” Frederick Chin, head of group wholesale banking and markets, UOB, said.

The Carbon Trust, a consultancy specialising in climate and environment-related advisory and assurance services, gave a “second-party” view on the framework.

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