Page 78 - CMA Journal (Nov-Dec 2025)

Focus Section

At the same time, China’s nationwide emissions trading Singapore – Carbon
system (ETS), operational since 2021 and expanding to Market Development,
include major sectors such as power, steel, cement, and Taxation, and Climate
aluminum, has become one of the world’s largest carbon
markets, enabling companies to buy and sell emissions Finance Hub
allowances and incentivizing reductions in energy-
Singapore is building a high-integrity carbon market
intensive industries.
ecosystem through coordinated inter-agency efforts
Complementing these market mechanisms, Chinese involving the National Climate Change Secretariat,
regulators have launched an updated Green Finance Ministry of Trade and Industry, Enterprise Singapore, and
Endorsed Project Catalogue, a unified green finance the Monetary Authority of Singapore (MAS), which
taxonomy defining eligible green investments and together are issuing guidance on corporate use of carbon
aligning financial flows with national climate priorities to credits, promoting industry coalitions to boost demand
enhance transparency and mobilize capital for for quality credits, and offering a Financial Sector Carbon
low-carbon infrastructure and clean technologies. Market Development Grant to help financial institutions
Beyond policy frameworks, corporate ESG integration is participate in carbon trading and carbon project finance.
gaining ground, with Chinese companies expanding Alongside these market-building measures, Singapore’s
non-financial reporting and embedding sustainability carbon tax, first introduced in 2019, is being
into core business strategies to support long-term progressively raised from S$25 per tonne in 2024 to S$45
environmental and social value creation, thus reinforcing per tonne by 2026-27, with long-term targets of S$50-80
the connection between sustainable investment, climate per tonne by 2030 to strengthen the price signal for
action, and governance reforms. emissions-reduction and incentivize investments in
low-carbon technologies and energy efficiency.
Japan – Transition
Complementing these efforts, the Monetary Authority of
Finance, Climate Bonds,
Singapore has secured USD 510 million for the Green
and Collaborative Carbon Investments Partnership fund, designed to support
Reduction sustainable infrastructure such as renewable energy,
sustainable transport, and energy storage across
Japan has strategically deployed its Green
Southeast and South Asia by blending commercial and
Transformation (GX) strategy to mobilize substantial
concessional capital to de-risk projects. These combined
climate finance and accelerate decarbonization, issuing
initiatives position Singapore as a carbon services and
Climate Transition Bonds under a framework designed to
channel up to ¥20 trillion over the next decade toward trading hub, promoting innovative financing solutions
low-carbon industrial transformation, renewable energy, and creating regulatory frameworks that support both
hydrogen research, and other climate-aligned sectors compliance and voluntary carbon markets. This approach
with clearly defined use-of-proceeds criteria to ensure helps mobilize climate finance and strengthens the
emissions-reduction and economic competitiveness. As integrity of regional carbon market participation.
part of this broader approach, the strategy also includes
the introduction of mandatory emissions trading, set to Sweden – Green Bonds,
begin in 2026, and the integration of climate risk into International Climate
financial assessments to internalize carbon costs and Finance & ESG Alignment
redirect capital toward decarbonization, strengthening
Japan’s domestic carbon pricing and sustainable Sweden has developed a robust sustainable finance
investment landscape. ecosystem underpinned by a well-established green
bond market that supports investments in transport,
Complementing domestic actions, Japan supports
renewable energy, and climate adaptation, with Swedish
international climate cooperation through the Joint
banks and financial institutions issuing significant
Crediting Mechanism (JCM), a bilateral initiative that
volumes of green and sustainability bonds aligned with
facilitates the diffusion of low-carbon technologies and
international standards to scale infrastructure
infrastructure in partner countries while enabling Japan
deployment and enhance investor confidence. In
to count quantified emission-reductions toward its
parallel, Sweden is a major contributor to international
climate targets. In parallel, Japan has developed ESG and
climate finance, pledging substantial resources to
sustainable finance frameworks, including green bond
multilateral funds such as the Green Climate Fund to
guidelines and broader sustainability disclosure
support mitigation and adaptation projects in
standards, to reinforce its domestic sustainable finance
market, enhance corporate climate reporting and risk developing countries, reinforcing its role in global
management, and align financial flows with long-term climate action and development cooperation.
environmental and social value creation.
76 ICMA’s Chartered Management Accountant, Nov-Dec 2025