SINGAPORE (Sept 18): Southeast Asia is lagging behind in sustainability efforts despite being most vulnerable to climate change, say experts at the BNP Paribas Sustainable Future Forum on Wednesday.

Rintaro Tamaki, president of the Japan Center for International Finance, believes Asia still has far to go in terms of a region-wide, integrated environmental policy to tackle the threat of climate change. And this is despite the region facing numerous cross-border environmental issues.

At the sidelines of the event, Tamaki tells The Edge Singapore that little attention is being paid to the use of fossil fuels and carbon emissions in the region.

For instance, he notes that Singapore is the first and only country in the region – as of now – to have introduced a Carbon Tax.

“Businesses are still sticking to ‘business as usual’. There are exceptions, but as a whole, they are sticking to their usual practises,” Tamaki says. “Many countries in the region are emerging economies, and they are seeking growth first, quality of life later. But these two should come at the same time.”

Indeed, research has shown that Southeast Asia is one of the most disaster-prone regions in the world, with researchers counting more than 1,000 incidents – including flooding, earthquakes, volcanic activity, drought and wildfire – between 1990 and 2016.

As the costs of renewable energy resources go down, Tamaki believes companies, even SMEs, should not be hampered by what is perceived to be higher capital investment into sustainable practises. “In fact, smaller companies are more agile to put in place these practises, compared to bigger companies,” he says.

He stressed that intergovernmental collaboration is the best way forward for the region to implement region-wide, cohesive and standardised regulatory frameworks, much like the European Union.

Nevertheless, Gabriel Wilson-Otto, head of stewardship for Asia Pacific at BNP Paribas Asset Management, says there has been a lot of development across Asia Pacific in Environmental Social Governance (ESG) efforts that has been very positive as a whole.

“If we look at ESG disclosure, regulations, revisions to corporate governance, and even China’s pivot towards addressing environmental issues by cutting down air pollution, [it] shows a lot of commitment and momentum in the region,” Wilson-Otto says. “So, the challenge from here is: How can we broaden the ecosystem of players in this region who are involved with the material issues?”

While he opines that Asia has done very well in improving what it currently has, Wilson-Otto says there are definitely steps to take in order to further enhance integration and build up a community of players actively working towards sustainability efforts.

“In order to solve these problems, it’s not just a matter of a government-led solution. We need the industries and investors to get on board,” he adds.

At the same time, he notes that profit and philanthropy are not mutually exclusive binaries, and that focusing on one does not necessarily mean having to trade-off the other. “What I think people are increasingly realising— and climate change is an example of this — is that there is a very strong overlap between what sustainable practises are, and what making money or a resilient business looks like,” Wilson-Otto says.

“The increasing natural disasters, insurance liability claims, shifting weather patterns on crops, rising sea levels are all issues that are becoming a financial reality. And the other side is the impact of changing consumer practises,” he adds. “If your consumer is asking for sustainable products, it only makes business sense to give your consumers what they want.”

Earlier, at the opening of the forum, Masagos Zulkifli, Minister for the Environment and Water Resources, stressed that businesses must move away from business-as-usual and transform the way things are done.

“The first step is to be clear-eyed about the business impacts of climate change. Companies must factor both the risks and opportunities of climate change into their long term growth strategies,” Masagos says. “This means holistically reassessing the entire value chain, from production to consumption, disposal and recovery.”