SINGAPORE (July 15): As efforts to prevent the worst effects of climate change gain urgency around the world, Singapore is already taking steps to address the crisis by investing in solar energy, developing more sustainable buildings and expanding the public transport system to reduce the need for cars.

Disclosing this development recently, Senior Minister of State for Environment and Water Resources Amy Khor adds that there is also a carbon tax, from which revenues will be “earmarked for worthwhile projects that improve energy and carbon efficiency”.

However, the government is but one entity in the national make-up, and “everyone”, she stresses, from civil society organisations and businesses to individuals, “must take urgent climate action”.

Indeed, the figures are concerning. Globally, only 57 countries, representing 60% of global emissions, are on track to meet their goal of cutting down emissions so that the global temperature rise is limited to 2° Celsius by 2030. The Environment Emissions Gap Report by the United Nations (UN) notes that if more countries fail to adhere to this, the world risks becoming hotter, with the average surface temperature likely to surpass 3°C. If that happens, weather patterns will be more erratic and sea levels will rise further, impacting the poorest people around the world the most.

The International Union for Conservation of Nature (IUCN) expects Asia to be among the worst affected, making the hundreds of millions living near low-lying and crowded coastal cities the most vulnerable. Adding to this, climate scientists at Crowther Lab, a Zurich-based research group, say 64% of the 22% of cities facing unprecedented climate change come from tropical areas in Asia such as Kuala Lumpur, Jakarta, Rangoon and Singapore.

AVPN CEO and chairperson Naina Subberwal Batra echoes Khor’s call for all stakeholders to act, which was made at the seventh AVPN conference held from 25 to 28 June. Batra notes that with the increasing strains to society arising from climate change, a ground-up approach is needed, and businesses must be involved in change.

“Businesses’ manufacture, procurement [methods], distribution channels and packaging types leave behind a big environmental footprint,” she tells The Edge Singapore. Batra believes that what has been holding them back is the cost of switching to a more environmentally friendly alternative. “Unless there is pressure from employees, customers, shareholders and regulators, businesses will not act.”

Nevertheless, businesses are now forced to change. Research from The Carbon Disclosure Project (CDP), a British organisation championing environmental change, reports that producing low-emission products could generate some £2 trillion ($3.4 trillion). This compensates for the £1 trillion in costs businesses would incur from climate change, over the next five years.

To facilitate this change, a Climate Action Platform was launched at the AVPN conference. The platform supports public– private sector collaboration by showcasing the range of innovations and investment opportunities in Asia that promote environmentally friendly practices. It also features opportunities for non-financial collaboration such as mentorship, strategic advice and market entry support.

“Collaboration among the public, private and people sectors is critical in the fight against climate change,” says Khor, who is also senior minister of state for health. “The Climate Action Platform is one such initiative. By leveraging AVPN’s global network, it can promote collective action — by connecting investors with green businesses and projects — and ensure that resources are deployed to the most impactful solutions.” Areas such as plastics pollution, transmission to low-carbon energy solutions, climate-smart agriculture solutions, carbon sequestration projects and disaster risk reduction intervention will be reflected on the platform.

As climate change factors increasingly affect investment decisions, Batra expects the research findings, policy work and causes of the social purpose organisations (SPOs) featured on the platform to spur even more interest among investors.

In fact, financial institutions are already riding the “green wave”. Khor says banks have now implemented policies that evaluate borrowers’ environmental, social and governance risks. Local banks announced earlier this year that they would not be financing new coal-fired power plants, she adds. The Monetary Authority of Singapore, for one, is extending its Green Bond Grant Scheme to include social and sustainability bonds. This is to offset the cost of obtaining a green bond certification. British bank Standard Chartered is also doing its part by devising new products that address environmental issues. José Viñals, its group chairman, says it has sold blue bonds for the protection of marine areas in Seychelles.

Health is wealth

Separately, a health platform focused on strengthening healthcare solutions for underserved urban communities was also launched at the conference. It looks into the affordability of healthcare and promotes the reach of these services, particularly to the poor and vulnerable. It also seeks to engage philanthropists and policymakers to spur conversations on this subject.

The platform is piloted in India and will be extended to the rest of Asia. India looks to benefit from this move, with data from the Asian Development Bank showing that 3.9% of babies in 2017 died before their fifth birthday. Also, 21.9% of the population lived below the national poverty line in 2011 — indicating their lack of access to proper healthcare treatments should illness arise.

Across Asia, a World Bank report notes that, of the 783 million extremely poor living below the US$1.90 ($2.60) a day, 33% come from South Asia, while 9% are from East Asia and the Pacific. And of 582 million people without access to proper drinking water in 2018, 25% are from South Asia, the World Health Organization (WHO) reports.

Through this platform, Batra hopes to shed light on the healthcare issues facing Asia so that more can be done by investors and policymakers to nip them in the bud.

Social enterprise development

To tie in all the initiatives, a social enterprise development toolkit was launched to align the expectations of investors and investees. The toolkit utilises a questionnaire to map out the interests, needs and investment goals of investors and investees — the SPOs. The questions look into the team, company vision, value proposition, product, market, business model, scale and exit strategy. With such information, more matches can be made through its deal share platform, a sector- and geography-agnostic information-sharing platform that lists SPOs and the causes they empower. Investors can search for these deals and decide on an organisation they want to invest in.

So far, “a match doesn’t happen [when] the investor expects X, and the investee organisation is at Y; through this questionnaire, they [will be using the platform] with a common understanding of what they want to achieve”, Batra explains.

AVPN chief operating officer Kevin Teo adds that a match will happen for users of the toolkit based on their financial and non-financial goals. “The toolkit connects into a catalogue of these resources and, from that catalogue, we will recommend to SPOs what is available based on their ‘venture investment readiness’ and ‘awareness level’,” he says.

Batra hopes that the conversations and networks forged at the conference, which brought together 1,254 delegates from around the world, will lead to solutions to alleviate societal challenges, chiefly the pressing issues of climate change, lack of access to proper healthcare and gender inequality.


Business, tech and finance stepping up for a better world

The Edge Singapore asked some of the social entrepreneurs who spoke at the AVPN Deal Share Platform, about their ideas to help reach the UN Sustainable Development Goals that were adopted by all member states in 2015 as a blueprint for global peace and prosperity.

Virtualpsychologist

Several years ago, Dervla Loughnane, a psychologist with more than 20 years’ experience, was called to a school because a student had committed suicide. Going through the student’s phone, Loughnane realised that he had not contacted anyone before ending his life.

That was why she set up Virtualpsychologist — a 24/7 counselling service provided over mobile text messaging — in 2017. She strongly believes that more needs to be done about rising mental health issues and the close to 800,000 suicides a year worldwide, according to latest WHO statistics. She explains her solution: “With people always on their phones, texting their problems is an easier way for them to communicate what’s troubling them.” Her company managed to help 1,593 individuals across Australia and Asia Pacific last year.

Overall so far, with 60% of clients from rural and remote communities and 44% of corporate clients liking the freedom of texting their emotions, the platform is doing its job well.

“The most common problems they face are stress, depression, anxiety and relationship issues,” says Loughnane, who charges an hourly fee of A$150 ($142). After its initiation, the platform received A$72,000 from Australian telecommunications company Optus. It later got a A$178,000 grant from the New South Wales state government for research on the feasibility of text counselling. Earlier this year, it received another A$1 million from the federal government to reach out to rural and remote communities in Australia.

It now has a presence in Australia and New Zealand and is expanding to the Philippines this year. Loughnane is seeking US$100,000 to develop an artificial intelligence software that will help diagnose the needs of users before they speak to a counsellor, so that counsellors can make more qualified decisions and better cater to their clients’ needs. Loughnane hopes it will assist less-skilled counsellors and volunteers to deliver the same service as a qualified psychologist with seven years’ experience. The company currently has eight full-time and 250 part-time counsellors and is looking to expand its team.

The funds it is seeking will also be used for its marketing and expansion initiatives.

Good Financial

Cherry, a domestic worker in Hong Kong, borrowed US$1,000 last year from Good Financial to renovate her home in the Philippines so that she could rent it out for additional income. She managed to repay the loan in seven months at a monthly interest rate of just 1.7%.

Cherry is among a large pool of domestic workers in Hong Kong and Asia who venture abroad in hopes of improving their families’ livelihoods. Because they are deemed to have poor creditworthiness, however, they cannot get access to credit on reasonable terms and are thus invisible in the financial system. This, in turn, further perpetuates their chicken-and-egg credit situation. Many are often compelled to borrow from illegal moneylenders or institutions that charge exorbitant interest rates.

Good Financial says 90% of some 400,000 domestic workers in Hong Kong have resorted to borrowing from either loan sharks that charge monthly interest rates of 10% to 20% or banks that charge between 1.6% and 4%.

Good Financial uses technology and data science to help borrowers obtain cost savings on their loans. It is also provides debt counselling and financial advice, and aims to provide additional ethical financial services in the future while rethinking the whole concept of lending.

Headquartered in Hong Kong, the organisation was set up in February 2018 with a grant of HK$550,000 ($95,000) from the government-sponsored Cyberport Incubation programme. It received its lending licence a month later and gave out loans in June that year. It is now scaling its platform to reach out to more members.

Its process is simple: Upon filling in an online application form, borrowers will meet a relationship manager, who will assess their needs and creditworthiness. Money will thereafter be transferred to the borrower, who can repay their loan at 7-Eleven convenience stores.

Through this system, migrant workers can surmount high interest rates, opaque loan terms, needing a guarantor and eventually handling aggressive debt collectors.

The business currently focuses only on domestic workers in Hong Kong. It is looking to extend this service soon to all migrant workers there and later to scale globally, in particular to Singapore and the Middle East, where there are large groups of migrant workers. Its CEO, Jared King, estimates these expansions to have a revenue potential of HK$150 million, with respect to Hong Kong, and HK$4.4 billion, from the rest of the world.

For this, King is seeking US$1 million. He hopes to save migrant workers a total of HK$100 million in interest by 2023, and to help impact investors generate financial returns.

Fieldsight

Justin Henceroth, Fieldsight director, realised that a major contributory factor in the collapse of numerous buildings in the 2015 Nepal earthquake was a lack of proper data on building codes, designs and common best practices.

“A building’s ability to withstand natural disasters is dependent on the quality of its structure,” he says.

Thus, to prevent such devastating effects in future quakes, the destroyed infrastructure had to be rebuilt based on proper building codes, engineering standards, designs and materials. To simplify this physically intensive process that is largely dependent on physical site visits and paper recording, the company has developed an app that digitises the monitoring process. This app can be accessed in remote areas and serves to support the requirements of post-disaster reconstruction and public sector development.

So far, the Fieldsight app has been used in more than 60,000 sites across 15 countries, in sectors such as housing, roads, schools, clinics, water and sanitation and agriculture. The organisation has been funded primarily by UN organisations and other humanitarian agencies. However, it faces stiff competition from high-end construction software. Henceroth says developing the software further comes at a high opportunity cost — having to increase costs of the projects, something the team is reluctant to do, given the social impact they wish to create.

So far, 90% of its original funding has come from UN Office for Project Services, with the remaining 10% from the World Vision Nepal Innovation Lab. Beyond this initial investment, the platform has grown based on payments from the UN, non-profits and government organisations. Fieldsight is seeking US$5 million to further develop its platform and expand into Asia, the Middle East, Africa and Latin America.

This story first appeared in The Edge Singapore (Issue 890, week of July 15)