This is the first post in a series about the Global Trader Dialogue 2019. Click here for the next post: Sustainable trading is no longer a nice to have.
Overview of the Global Trader Dialogue 2019
Today’s global trading environment has been redefined by the waves of a volatile geopolitical backdrop and by limited resources. As Singapore strengthens our commitment to be a strong advocate for free trade, it is crucial that we continue to be a trusted node for all parties to transact fairly, efficiently and sustainably.
In his keynote speech, Senior Minister of State for Trade and Industry Dr Koh Poh Koon urged commodity traders to ride these waves with the strong support of Singapore’s robust infrastructure and stable rule of law. Elaborating on this, he explained that Singapore has worked to boost the export competitiveness of businesses by growing our Free Trade Agreement (FTA) network with markets across the world.
To support businesses in utilising Singapore’s FTAs, the International Chamber of Commerce (ICC) Academy, together with Enterprise Singapore has developed an online FTA certification programme that employees across different functions can participate in.
In his speech, Dr Koh strongly emphasised the need for businesses to go green. Good stewardship of the environment, natural resources and communities is no longer just a ‘good-to-have’, but is today regarded as a competitive advantage that is critical for future-proofing businesses.
In a 2018 study by Nielson, a global measurement and data analytics company, more than a quarter of the global respondents would pay more for products made with sustainable materials and with socially responsible claims. Hence, to remain competitive, businesses need to manage environmental resources in a sustainable way.
Going Green
Major institutions around the world are now taking steps to answer this call for sustainability. According to the Environmental, Social and Governance Global Survey 2019, institutional investors now have a stronger commitment to allocating funds towards Environmental, Social and Governance (ESG) issues.
Within Singapore, government entities and major institutions have also promoted and regulated sustainable financing. These include the Guidelines on Responsible Financing by the Association of Banks in Singapore in 2015, the mandating of sustainability reporting for listed companies by the Singapore Exchange, which started at the end of 2017 and the Green Bonds Grant scheme by the Monetary Authority of Singapore, introduced in 2018.
Several big trading companies are now leading the way in ensuring that their businesses are sustainable. For example, Shell is planning to link its executive remuneration to carbon emission targets from 2020. Maersk has publicly pledged to cut net carbon emissions to zero by 2050. Just last year, Olam and Wilmar pegged the interest rates of revolving credit facilities to sustainability targets, a move that signals a willingness to support companies involved in sustainable projects.
In addition to creating goodwill with consumers, such sustainable targets improve resource management, which reduces operating costs within businesses. This in turn ensures profitability. In a report published by CDP, an international non-profit organisation providing environmental information, companies estimated that opportunities related to climate change could bring in US$2.1 trillion. Given this, investors and stakeholders can likely expect a significant rise in climate-friendly products and services from the world’s largest companies.
Within our trading ecosystem and beyond, major industry players and customers are now proactively going green. Hence, businesses in Singapore, of all sizes, will be affected by sustainability concerns, not only for ethical reasons, but also for commercial ones.
Supporting Sustainable Businesses
To support businesses in moving towards sustainability, Enterprise Singapore is partnering with the many innovative companies and platforms located on our shores to provide digital solutions, collaborative opportunities and more that can empower businesses to become more sustainable, resilient and future-proof.
Under the Research, Innovation and Enterprise (RIE) 2020 Plan, Singapore has also added US$300 million to strengthen digital technologies and automation expertise. This plan strives to establish Singapore as a Global-Asia hub of technology, innovation and enterprise.
In Dr Koh’s speech, he highlighted three notable innovative companies and platforms – Perlin, Forcefield and Agri Innovation Lab – that support businesses in adopting leading-edge digital solutions like block chain, Internet of Things (Iot) sensors, Near-Field Communication (NFC) chips and more. Such solutions allow businesses to reduce resource wastage, hence increasing financial benefits.
To support the growth of sustainable businesses, a ready talent pool is needed. On top of having a talent pool from Nanyang Technological University (NTU)’s International Trading Programme, which provides undergraduates with skills and knowledge on cross-border trade, Enterprise Singapore has also partnered with NTU and others from the international trading community to launch a new Minor in International Trading. This will provide a steady talent pool of multidisciplinary students for the industry.
In addition, Enterprise Singapore has partnered with various stakeholders such as Workforce Singapore (WSG), the Employment & Employability Institute (e2i), Singapore Management University (SMU) and Singapore Business Federation (SBF) to put in place training, upskilling and reskilling programmes that will help our workers to find meaningful employment in the trading sector.
Building Tomorrow Together
Even amidst pressing global challenges, Singapore remains confident that businesses can find opportunities, while balancing growth with sustainability. This can only be done through the collective efforts of business leaders and other stakeholders in the trading ecosystem.
Learn how organisations are going green, read the highlights of the GTD 2019 panel discussion.
