The Ministry of Environment and Water (KASA) and Ministry of Finance (MOF) welcome the ASEAN Taxonomy for Sustainable Finance, Version 1 (ASEAN Taxonomy), released by the ASEAN Taxonomy Board (ATB) in conjunction with the 26th United Nations Climate Change Conference of the Parties (COP26) on 10 November.
The ASEAN Taxonomy is a joint initiative by ASEAN finance sectoral bodies, whereby Malaysia is represented by Bank Negara Malaysia (BNM) and Suruhanjaya Sekuriti Malaysia (SC), as part of the twelve members of the ATB that represent all ASEAN Member States.
This regional initiative is a major milestone that demonstrates the region’s collective commitment and tailored approach in transitioning towards a more sustainable ASEAN.
It aims to guide capital and funding towards green and transitional activities, in line with ASEAN’s commitment under the Paris Agreement.
As ASEAN is a region of diverse economies and financial systems, the multi-tiered taxonomy will promote an inclusive adoption that will benefit all ASEAN members, while incentivising members to make credible progress towards climate goals.
The initiative also supports Malaysia’s aspiration to be a net-zero carbon nation as early as 2050, complementing the country’s green recovery agenda, National Investment Aspiration (NIA), and Budget 2022’s focus on sustainability and economic recovery.
It is also aligned with the Climate Change and Principle-based Taxonomy issued by BNM early this year; and the environmental component of the Sustainable and Responsible Investment (SRI) Taxonomy for the Malaysian capital market that is being developed by SC.
These taxonomies, collectively, will create opportunities and spur more investment flows, including foreign funds, into the country.
KASA and MOF, along with other Ministries and relevant stakeholders, will support the next stage of development of the ASEAN Taxonomy, and its implementation.