The Singapore Sustainable Finance Association (SSFA) has launched a 41-page guide for financial institutions and real economy corporates on using the Singapore-Asia Taxonomy for Sustainable Finance (SAT) when structuring green and transition financing.
Released on July 9, the handbook was first announced by Deputy Prime Minister Gan Kim Yong at the Association of Banks in Singapore (ABS) Annual Dinner on June 25.
Introduced by the Monetary Authority of Singapore (MAS) in December 2023, the SAT is the world’s first multi-sector taxonomy to feature a dedicated transition — or “amber” — category. It details thresholds and criteria for green and transition activities that contribute to climate change mitigation across eight focus sectors.
The SSFA guidance seeks to support further adoption of the SAT by providing guidance on data availability, treatment of interim thresholds, grandfathering provisions, meeting entity-level transition plan requirements and the interpretation of “amber” categories.
The publication also presents preliminary guidance on how to reference the SAT when full alignment is not feasible. This includes situations where the assets or projects cannot meet all of the SAT’s criteria due to reasons beyond the borrower’s control or where the assets enabling and value-chain activities that support green and transition efforts are not set out in the SAT.
Drawing on insights from over 20 industry members across financial institutions, second-party opinion providers and industry associations, SSFA’s guidance translates complex taxonomy requirements into actionable steps that promote consistent application, build market confidence, unlock financing opportunities and advance transition finance.
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SSFA is developing a digital SAT frequently asked questions (FAQ) repository as well as a course curriculum that will offer insights, training and resources to promote credible application of the Taxonomy.
In March, MAS published a 20-page information note on how financial institutions, corporates and the public sector can apply the SAT, including eight examples of loans by Singapore’s three banks that are aligned with the Taxonomy.
