Singaporean bank OCBC and trade promotion agency Enterprise Singapore ( EnterpriseSG ) have launched a new programme – the OCBC SME Start ESG Programme – to support small and medium-sized enterprises ( SMEs ) with tools to improve their sustainability performance.

The programme will help SMEs obtain a baseline measurement of their sustainability metrics, expert advice on sustainability practices, and access to sustainability-linked loans ( SLLs ) from the bank. 

The bank expects 300 SMEs to participate in this programme and plans to extend SLLs to them. EnterpriseSG will support up to 70% of eligible costs for the annual assessment for each SME’s sustainability performance over a three-year period.

Through the programme, SMEs will be able to:

• Stay competitive: By establishing a baseline measurement of their sustainability performance, SMEs can enhance their relevance and competitiveness to meet the sustainability criteria required by prospective large corporate customers. 
• Improve their sustainability performance: The SMEs will be guided by the bank’s sustainability experts and provided with key insights and advisory on formulating and implementing practices to improve their sustainability performance. 
• Gain access to sustainability financing: Using the baseline measurement, the SMEs can obtain an SLL from the bank to fund the implementation of the sustainable practices. This means that the cost of borrowing is linked to the SME’s sustainability performance. 

To measure the sustainability performance of the SMEs under this programme, the bank has partnered EcoVadis, a global environmental, social and governance ( ESG ) assessment provider, and ESGpedia, a regional carbon management solution provider. The EcoVadis assessment will review the SMEs’ performance across four themes – environment, labour and human rights, ethics and sustainable procurement. ESGpedia’s assessment covers greenhouse gas emissions. 

“Going green is good for business,” says Linus Goh, the bank’s head of global commercial banking. “Our SME and corporate customers are increasingly stepping up to adopt sustainability methods and financing to future proof their businesses.

“As large multinational and regional corporates formalize their net-zero ambitions and decarbonization targets, SMEs that are sustainability-ready differentiate themselves positively and are winning new business in the supply chains.”