2025 Programme Highlight
Sustainable Finance:
Unlocking Capital for the Clean Energy Transition
Key Highlights
Version 4 of the ASEAN Taxonomy was published and is now referenced in country taxonomies in Cambodia, Indonesia, Malaysia, the Philippines, Singapore, and Thailand, establishing a common foundation for taxonomy development.
Mandatory climate-related and sustainability disclosures commenced for listed companies in Singapore, while South Korea launched a proposed implementation roadmap for the Korea Sustainable Development Standards.
In Bangladesh, the central bank issued a Sustainable Finance Policy for Banks and Financial Institutions, including requirements to allocate a share of lending to green finance, while Pakistan introduced a national green taxonomy.
Case Study
Advancing a shared foundation for sustainable finance across ASEAN
For more capital to flow toward the clean energy transition, investors, businesses, and regulators need a common language for what counts as “sustainable” and to support the transition. Across a region as diverse as the Association of Southeast Asian Nations (ASEAN) — spanning vastly different economies, financial markets, and stages of development — building that shared language is as much a collaborative and diplomatic undertaking as a technical one. The ASEAN Taxonomy for Sustainable Finance exists to provide it: a common reference that helps align how member states classify green, transition, and non-aligned activities, so capital can move across borders with greater clarity and confidence.
In 2025, the publication of Version 4 marked an important step in that collaborative effort. Rather than imposing a single standard from above, the taxonomy is designed to work alongside national frameworks — offering a regional anchor that individual countries can reference and adapt to their own circumstances. By the end of the year, it was reflected in national taxonomies across Cambodia, Indonesia, Malaysia, the Philippines, Singapore, and Thailand, helping establish common ground while leaving room for each market to develop at its own pace but towards a common goal.
Reaching this point required sustained coordination among governments and financial-sector stakeholders with differing priorities and starting points — part of the patient, consensus-building work that underpins durable progress. Tara partner, the Sustainable Finance Institute of Asia (SFIA), acts as the host and provides administrative and technical expertise for the ASEAN Taxonomy Board. Their work supports this complex process, contributing technical analysis and facilitation that assisted key stakeholders in working through points of alignment and translating shared principles into a workable common reference.
The value of this groundwork will grow as the taxonomy is put into use. Common definitions reduce fragmentation, lower greenwashing risk, and make it easier for cross-border capital to identify credible green and transition investments. Much remains to be done — particularly in strengthening criteria for transition activities and supporting national implementation — but ASEAN’s progress in 2025 shows how shared, regionally owned standards, built collaboratively, can lay durable foundations for the finance the energy transition depends on. Despite being a voluntary taxonomy, the ASEAN Taxonomy has already been used by capital users, included as part of ASEAN official efforts, and incorporated into the sustainable finance frameworks of financial institutions.