FSC Taiwan launched the “Green Finance Action Plan 2.0” for joint creation of a sustainable finance ecosystem by public and private sectors. The Action Plan was created to use financial mechanisms to increase the awareness of companies and investors of environmental, social, and governance (ESG) issues, to facilitate sustainable development and cooperation between the public and private sectors to achieve carbon-reduction and sustainable development goals of Taiwan.
The “Green Finance Action Plan 1.0” included 25 measures that covered seven aspects: credit, investment, capital market fundraising, professional development, promotion of further development of green financial products and services, information disclosure, and promotion of the concept of green sustainability. For the Green Finance Action Plan 2.0, short-term and medium-term objectives have been established and these include three core strategies and eight major aspects to be addressed through the implementation of 38 concrete measures (of which 17 measures are a continuation of Plan 1.0 while 21 have been newly added for Plan 2.0). The short-term objective for the Action Plan includes building a framework and the foundation conducive to the effective operation of green and sustainable finance market, increasing information transparency, and channeling funds to support green and sustainable development industries. The medium-term objective involves guiding the financial market on addressing the potential risks of climate change, capitalizing on the associated opportunities, and strengthening the competitiveness of our financial industry and market. The major aspects to be addressed through the implementation of various measures include the following:
- Credit—Eight measures that aim to encourage, through incentives and support programs, financial institutions to grant credit and loans to green energy industries and sustainable development projects and to adopt measures in line with international norms
- Investment—Five measures that aim to advocate responsible investment by amending relevant rules and guidelines and encourage financial institutions and government agencies to invest in sustainable development projects
- Capital market fundraising—One measure involving continued promotion of green bond issuance and investment and the other involving development of sustainability bonds to diversify the financial products and financing channels in the country's capital market
- Professional development—A measure for cultivating financial professionals with expertise in green and sustainable finance in the hope to build capability for developing sustainable finance
- Promotion of further development of green financial products or services—Seven measures that aim to encourage financial institutions to develop innovative green financial products or services that will meet the financial demands of businesses and investors pursuing low-carbon transformation and sustainable development
- Information disclosure—Five measures that aim to improve the quality, consistency, and transparency of corporate ESG disclosure by amending related regulations and establishing integration platforms in an effort to provide the financial market participants with comparable, reliable, and comprehensive information
- Prudential supervision—Two measures involving a new aspect to the Action Plan 2.0 that aims to prompt financial institutions to examine climate-related risks and their ability to address such risks
- International connections and incentive mechanisms—Eight measures pertaining to studying the scope (taxonomy) of sustainable finance in reference to international practices and through incentives
Keywords: Asia Pacific, Taiwan, Banking, Insurance, Securities, Green Finance, ESG, Climate Change Risk, Disclosure, Action Plan, Sustainable Finance, FSC Taiwan
Previous ArticleCMF Issues Rule for Identification of Systemically Important Banks
The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.
The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).
In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.
The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.
The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.
The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.
The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.
The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.
The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.
The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.