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More than 60 per cent of corporate companies in the Asia-Pacific region intend to implement net zero 2030 targets, with a further quarter aiming for the goal by 2040, new research has found.
Westpac’s Financing for Sustainability report, focusing specifically on the Asia-Pacific region’s evolving ESG market, aimed to examine shifting attitudes towards sustainability practices among large corporates.
The bank polled 150 investor executives based in Australia, Hong Kong, Japan, New Zealand and Singapore, as well as 150 issuer responders from large corporations based in either Europe, the US, or Asia-Pacific.
Since the last survey in 2019, Westpac found a significant upward trend in firms actively engaging with the issue: 85 per cent of corporates surveyed are now actively pursuing the decarbonisation of their business, while 91 per cent of investors are decarbonising their portfolios.
Anthony Miller, chief executive of Westpac Institutional Bank, said the new research indicates that “investors and issuers in the region are taking climate matters into their own hands, and are actively pursuing the decarbonisation of their businesses and portfolios”.
“In fact, almost half (46 per cent) of investors surveyed expect to have over 50 per cent of their AUM allocated to sustainable investment by 2025,” Mr Miller continued.
“On the issuer side, just 18 per cent of companies surveyed in 2019 had issued or utilised sustainable financing in the Asia Pacific market. Today that figure has grown to well over half – 56 per cent – and evolved to an increasingly broad range of debt and equity tools being issued, as companies move beyond green bonds,” he said.
One-quarter of the corporates who engage in sustainable finance cited the company’s sustainability objectives as their primary motivating factor, while 22 per cent cited the financial benefits, and 18 per cent said it was to diversify their investor base.
In Mr Miller’s view, decarbonisation is becoming “a core strategic business focus”.
“Across the board we are seeing strong commitment to mitigating climate risk and meeting ESG targets, underpinned by improved financial performance,” he said.
ABOUT THE AUTHOR
Juliet Helmke
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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