Investors Expect Clearer and More Transparent ESG Disclosures from Financial Institutions about Their Climate and Deforestation Risks

A Singaporean Non-Governmental Organisation (NGO) report highlights gaps in transparency in some financial institutions’ policies around the palm oil value chain The rising focus on climate change and interaction between deforestation and pandemic risks makes these sectors important to many investorsLack of transparency is viewed as a poor Environmental, Social, and Governance (ESG) practice by many investors, making clear and informative disclosures important to attracting capital from ESG-focused investors

Banks with exposure to environmentally sensitive sectors don’t just face a risk of loss from environmental damage. They also have to be concerned with setting stakeholder expectations about their risk management practices, which can...