Speech by Mr Alvin Tan, Minister of State, Ministry of Trade and Industry and Ministry of Culture, Community and Youth, and Board Member of MAS, at the Launch of the[...]

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Industry partners,
Distinguished guests,
Ladies and gentlemen,

Introduction

1. Delighted to join everyone to launch the Sustainable Finance Jobs Transformation Map (JTM). Warm welcome to our partners from industry, association bodies, training providers and institutes of higher learning.

2. In my remarks, let's together explore three questions:

• WHY do we need a Sustainable Finance Jobs Transformation Map?
  
• WHAT does the Map look like?
  
• HOW do we make the Map work?

3. First, why do we need a Jobs Transformation Map? Because we need a workforce that is ready for the opportunities we are creating in sustainable finance. If Singapore is to be Asia's leading sustainable finance hub, we must equip our workforce to be ahead of complex and fast-evolving sustainable-finance related issues and opportunities. Let me outline these opportunities in detail.

4. Climate change and sustainability is driving significant economic transformation. Asia alone needs ~US$1.7 trillion in infrastructure investments annually until 2030 to maintain growth while meeting climate goals.Extracted from ADB's "Innovative Financing Key to Private Sector Participation in ASEAN+3 Infrastructure Development" 2023.

a. So businesses must create new models and strategies to thrive in a low-carbon economy.
b. They must redesign supply chains to be more resilient against disruptions from climate change and decarbonise or shift to cleaner energy.
c. Businesses that do so will maintain competitiveness and capture new opportunities that we are all creating.

5. Businesses must thus continually update their sustainability plans. Technologies such as carbon capture, utilisation and storage, and sustainable aviation fuels are still nascent. So businesses must develop an interim strategy to reduce emissions as best as possible and pivot quickly when these technologies mature.

6. Transforming and decarbonising the real economy also requires significant investments in technology and infrastructure. According to the International Energy Agency, global clean energy investments need to hit over US$4 trillion per year by 2030 to reach the 2050 net zero target.According to IEA Net Zero Emissions by 2050 scenario. As stewards and providers of capital, the financial services sector plays a critical role in facilitating and unlocking much needed financing for businesses to achieve their sustainability outcomes.

a. Sustainable investment assets under management (AUM) globally reached >US$30 trillion in 2022, accounting for almost a quarter of total AUM.Extracted from the Global Sustainable Investment Review 2022.
b. Global issuance of green, sustainability and sustainability-linked loans and bonds also grew from a niche segment of ~US$30 billion in 2013 to >US$1.3 trillion in 2023.Extracted from ING Research and Bloomberg NEF.
c. It is encouraging to see continued commitment towards sustainability and the positive momentum on sustainable lending instruments.

7. What is Singapore doing? On our part, Singapore strives to serve our region's sustainable financing needs. The Monetary Authority of Singapore (MAS) Finance for Net Zero (FiNZ) Action Plan sets out how we plan to mobilise financing to catalyse Singapore's and Asia's net zero transition.

a. We have much to do. We must promote credible and innovative green and transition financing solutions and markets, while forging a climate-resilient financial services sector.
b. For instance, a priority for the MAS is to develop targeted solutions such as blended finance, carbon markets and transition labelled instruments that reference the Singapore-Asia Taxonomy.
c. MAS consulted industry on our Guidelines on Transition Planning last year. The proposed Guidelines set out supervisory expectations for financial institutions to have sound risk management processes and internal strategic planning to prepare for risks and potential changes in business models associated with the net zero transition.
d. Promoting high quality climate-related disclosures and data are also key priorities. SGX-listed companies must currently make these disclosures in line with recommendations from the Task Force on Climate-Related Financial Disclosures (TCFD), but will soon be required to do so in line with new standards issued by the International Sustainability Standards Board (ISSB) from 2025.

8. To capture all of these opportunities I outlined, we need to invest in our workforce. In fact, a key enabler under MAS' FiNZ Action Plan is building a workforce with requisite skills and expertise. We also need to reskill and upskill our existing pool of professionals in the sector and build new talent pipelines.

9. That is why we need the Sustainable Finance JTM.

Key Findings of JTM

10. I've explained why we need a Sustainable Finance Jobs Transformation Map. Let's next explore how this map looks like.

11. The map is jointly developed by MAS and Institute of Banking & Finance (IBF), in collaboration with Workforce Singapore (WSG). It looks at:

a. Key sustainability trends driving changes to jobs and skills in the financial services sector;
b. The impact of these trends on individual job roles; and
c. The skills required as job roles evolve.

12. There are three key findings from the JTM: distilled into "OTC" - Opportunity, Transformation and Creation.

13. First, "O" - Opportunity. The JTM projects that ASEAN's sustainable financing needs will amount to S$4 - S$5 trillion over the next decade, while Asia's sustainable financing needs will be ~S$40 trillion over the same period.

a. This is a huge market opportunity, and the window to capture it is narrowing. The time for our financial institutions to position themselves well to seize these opportunities, is now.

14. Second, "T" - Transforming existing jobs. This is driven by global regulations and standards, and tech innovation in sustainability-related data gathering and analysis work. This means many finance professionals will need to understand new rules, stay nimble and learn to use such technology to better take on new sustainable finance-related tasks.

15. The JTM estimates that >50,000 professionals will see their jobs change to a moderate to high degree.

a. This applies to a few career tracks, especially in Risk, Compliance and Legal, and Product Solutioning and Management.
b. On the other hand, some job roles will only see a low degree of change. For instance, existing protocols adopted by insurance claims managers will likely still be applicable to claims from new sustainability-linked products.

16. But for the 50,000 professionals in highly or moderately augmented job roles, what will this change look like? Let's consider how a relationship manager in a corporate bank could have his or her job transformed.

a. Relationship managers are traditionally expected to service the financial needs of corporate clients, identify financing solutions, and facilitate banking services.
b. With sustainable finance becoming mainstream, relationship managers in corporate banking must better understand their clients' climate transition plans, as well as key sustainability topics such as decarbonisation pathways in sectors their clients operate in.
c. They should also have a good grasp of sustainable finance products to better propose solutions aligned with their clients' sustainability framework.

17. The JTM helps finance professionals manage these changes within their job roles by spelling out specific skills they need. This builds on earlier work by MAS and IBF, which outlined a set of 12 technical skills and competencies in sustainable finance in 2022.

a. With the JTM, skills are now mapped to individual job roles, so professionals will have a list of skills and level of proficiency of these skills that you need. This is useful because you can either use these skills in your current job, or when you change roles to ones which require some sustainable finance skills.
b. This mapping of jobs to skills also helps HR professionals as you do workforce planning at the organisation level.

18. Lastly, "C" - Creating new job roles. This could be in areas where more specialised skills are needed such as sustainability risk management, or where certain organisation structures are adopted such as dedicated centralised roles for sustainability strategy planning.

19. These new job roles have already started to emerge in some financial institutions, as they increasingly incorporate sustainability priorities into their core business strategies.

20. KPMG, who was commissioned to conduct the study, will dive into these findings in greater detail later. I'll leave it to Patrick to share more later.

An Ecosystem to Support Jobs Transformation

21. Now that we understand why we need a Sustainable Finance Jobs Transformation Map and what the map looks like, let's finally explore what we need to do to make it work.

22. First, we need all stakeholders in our ecosystem to work together to equip our workforce with sustainable finance capabilities. Most critically, we need financial institutions to invest in continuously upskilling their staff as organisational needs evolve.

a. I am encouraged to know that more than 25 financial institutions in Singapore are already planning to upskill their employees in sustainable finance within the next 3 years.
b. One of these is HSBC, and we will hear more from Mr Kelvin Tan, HSBC's ASEAN Head of Sustainable Finance & Investments, during the panel discussion.

23. Second, we will back the plan, with funding. MAS will set aside S$35 million in the Financial Sector Development Fund to support upskilling and reskilling, and develop specialist talent.

a. This includes training for individuals in IBF-accredited and recognised sustainable finance courses. More than 100 of such courses are available today, and we will work with partners to add to this number in the coming months.

b. These courses cover in-demand areas such as sustainability risk management and sustainable investment management skills.

c. This funding will also support talent development and capacity building efforts by our centres of excellence, including the Singapore Green Finance Centre in SMU and the Sustainable and Green Finance Institute in NUS.

24. Third, MAS and IBF will continue to work closely with the training ecosystem to meet our industry's upskilling needs. Let me share how.

25. IBF will roll out a new skills badge for sustainable finance. Today, our industry lacks a common industry benchmark to recognise an individual's competencies across sustainable finance skills. This new badge will provide that industry benchmark. It will accord recognition to individuals who have acquired relevant sustainable finance skills. This will help financial institutions better conduct skills-based hiring and promotion.

26. Next, our universities and polytechnics will expand their suite of high-quality programmes targeted at undergraduates and polytechnic students. Existing degrees and diplomas today mostly cover a broad range of sustainability topics. But sustainable finance also requires specialised skills:

a. NTU will launch a new Bachelor of Accounting in Sustainability Management and Analytics. The inaugural batch starts this August.
b. NUS' Business School will also introduce a new specialisation in sustainable finance in the near future. This will complement its popular Master of Science in Sustainable and Green Finance.
c. Ngee Ann Polytechnic also offers a sustainable finance course within its Diploma in Banking & Finance.

27. These new programmes will provide early exposure and inspire our students to pursue careers in this area, and contribute to our sustainable finance agenda. Let me share real life examples of incredible individuals who have embraced and made this change.

a. First, let me share the story of Ms Wong Dan Chi.

i. Dan Chi started her career in auditing after graduating from SMU with a double major in finance and accounting. However, an immersive experience at an international climate change course she attended while working changed everything.
ii. She was the youngest delegate in the course, and this early exposure sparked her interest in sustainability and propelled her to make a career switch into sustainable finance. She later pursued two master's degrees in environmental economics and sustainability leadership.
iii. Dan Chi now heads Schroders' APAC ESG advisory and integration team. I hope her story inspires our students to get a head start into this exciting space.

28. Various training providers will launch >65 new executive courses and a new executive master's this year to upskill our mid-career workforce.

a. The courses are pitched at different technical skills levels. This month, SMU will launch its foundational level Asia-focused Massive Open Online Course (MOOC) on the Introduction to Sustainability and Sustainable Finance.
b. Referencing key skills gaps identified in the JTM, training providers such as the Singapore College of Insurance and Ernst & Young Singapore will launch courses on sustainability risk management and taxonomy application at a more advanced level.
c. There will also be more role-based courses such as the Wealth Management Institute's Carbon Market and Decarbonisation Strategies tailored for bankers and wealth managers. These roles-based courses provide contextualised training scenarios that bridge the gap between theoretical knowledge and practical application.
d. I encourage existing finance professionals to attend one of these thoughtfully developed courses to upskill.

29. An exemplar of continuous learning is Mr Mike Ng- OCBC's Group Chief Sustainability Officer.

a. Mike built his career around traditional project and structured finance, working on large scale infrastructure projects spanning industries from power and utilities to transportation. As sustainability trends emerged and the sustainability impact of these projects grew, Mike's career transition into sustainable finance took a natural turn.
b. Mike took an overseas 8-week sustainable finance course, which has equipped him to better lead OCBC's sustainability agenda for lending and wealth management today.

30. What about non-finance professionals? Well you can also sign up for training courses to prepare for a role in sustainable finance. To support you, WSG's Career Conversion Programme (CCP) provides industry-recognised training with salary support.

a. Chrystal Angis an inspiring example of one who made such a switch successfully. Chrystal started off as a research analyst in the civil service. Looking to make a mid-career transition to the field of sustainability, Chrystal started an 18-month CCP journey which provided her both structured training and on-the-job training.
b. The skills Chrystal gained gave a head start in her new role as Sustainability Manager at Prudential Singapore. She now works with internal stakeholders to progress Prudential's sustainability efforts, including producing its annual sustainability reports.

Conclusion

31. We've explored why we need a JTM, what it looks like, and how we can all do specific moves to make it work. We've also explored real life stories from Dan Chi, Mike and Chrystal that inspire us to pick up these new skills and take on new roles.

32. So we see an opportunity, come up with a plan, and execute it. Singapore style. So join us, as we chart a course towards a sustainable, vibrant and resilient future for Singapore.

33. Before I end, I would like to express my gratitude to industry partners for your immense contributions to our JTM study.

a. First, our JTM Steering Committee. Thank you for your dedication and insights which enriched our understanding of the direction and support that industry needs on sustainable finance jobs and skills.
b. I would also like to thank other industry practitioners who shared your experiences and expertise through various interviews and focus group discussions to validate our JTM's findings. You helped ensure the robustness of our findings and how useful it can be to prepare our workforce for sustainable finance.

34. Thank you.