DBS Private Bank: 50% of assets to be sustainable by 2023
Doubling down on its sustainability agenda, leading Asian financial services group has announced that its private banking arm, DBS Private Bank, has committed to growing its suite of sustainable investments to more than half of its assets under management (AUM) by 2023, up from 41% today.
With this commitment, DBS is further entrenching its position as Asia’s industry leader in sustainability and galvanising its regional clients to adopt environmental, social and governance (ESG) standards in their investments.
The bank will also widen and deepen clients’ access to its ecosystem of social enterprises (SEs) in the region to fund, support and develop these enterprises, which include next-gen tech leaders that are innovating breakthrough solutions to positively impact communities.
These initiatives, part of DBS Private Bank’s three-pronged sustainability approach to drive ESG investing, advocate responsible business practices, and create social impact.
According to Joseph Poon, Group Head of DBS Private Bank, while “sustainable investments have become increasingly important in value-adding investment portfolios in the long run”, their pace of growth is being hampered as there is still no clear definition for sustainable investments today and no single established industry benchmark to rate ESG.
“We decided to take the lead in challenging this status quo, and were among the first in Asia to integrate MSCI ESG ratings into our product suite. By taking this step, we are not only availing greater transparency of our offerings, but are also holding ourselves accountable to our pledge to boost our share of sustainable investments.”
ESG in Asia catching up with the west
Asian assets tend to have lower ESG ratings than their Western counterparts, a reflection of a region that’s home to many developing nations still in early stages of economic development.
Asia has however started to catch-up in recent years, amid rising consumer expectations and government calls for businesses to focus on sustainability issues.
And DBS Private Bank, with its wide holdings of Asian assets, deep understanding of the region’s diverse heritage, and strong network of Asian clients, is well-positioned to play a leading role in ESG advocacy mobilising clients towards positive change.
Expanding its sustainable product suite
This year alone, the bank is looking at onboarding more than 10 sustainability products, comprising a range of exchange-traded funds, mutual funds and private equity investments. This includes a Global Environment Fund that will grant customers diversified exposure into a range of decarbonisation themes including Renewable Energy, Electrification and Resource Efficiency.
The bank will also review clients’ portfolios to improve their ESG rating through targeted advisory and recommendations and will formalise how ESG is assessed through the launch of a portfolio-weighted ESG rating methodology in Q2 – an Asia-first initiative that will move beyond rating individual holdings, to rating clients’ portfolios holistically.
Poon adds: “We’re privileged to be working with clients who are business-owners or in positions of influence, and are well-placed to drive positive change through their commercial enterprises; many also have the means and the desire to give back to society, not only through traditional philanthropy, but also by supporting social enterprises dedicated to addressing pertinent societal gaps.
"As a trusted partner on their wealth journey, our role has gone beyond growing and managing their wealth. Increasingly, we help our clients to “connect the dots” on multiple fronts so they can build meaningful and purposeful legacies for their future generations."
