Overview

As funds continue to flow into sustainable products and investments, it is critical to guard against the risk of greenwashing and maintain investor confidence in the sustainable finance market and ecosystem. Greenwashing can occur at the firm level and product level, such as overstating or being unclear about a firm’s sustainability commitments, or a lack of alignment between the product’s stated sustainability objective and its actual investment allocations.

MAS’ efforts to mitigate greenwashing in the financial system remain focused on strengthening key enablers: (i) taxonomies to serve as established, science-based and common references for financial institutions to determine whether an economic activity is classified as green or transition; and (ii) enhancing the comparability, consistency and decision-usefulness of sustainability disclosures at the firm and product level to support investors’ decision-making and cross-border capital flows.

Over the past year, MAS has built on these efforts to mitigate greenwashing. This includes further guidance on disclosure practices for retail ESG funds, continued refinement and industry engagement on the application of the Singapore-Asia Taxonomy, and collaboration with IOSCO and ACMF to support greater alignment in sustainability disclosure practices across jurisdictions. MAS has also worked with the Singapore Exchange (SGX) to incorporate climate-related disclosure requirements of the IFRS Sustainability Disclosure Standards for SGX-listed issuers from FY2025.