How Singapore firms overcome the hurdles towards sustainability

Government support, especially for SMEs, critical to achieving net zero carbon emissions

Whilst Singapore businesses strive for sustainability, most of them are struggling to create concrete plans to meet the country’s commitment to reduce its carbon footprint to zero due to a lack of budget and workforce.

A recent ENGIE Impact survey showed that 14% of companies in Singapore believe they succeeded in meeting their decarbonisation goals. The rest that said otherwise cited financial challenges, the need for stakeholder engagement, and navigating regulatory requirements as their roadblocks.

Jackson Seng, Schneider Electric's vice president for sustainability and strategy, said that to commit, they must look beyond the hurdles because sustainability will become a business risk for many companies.

“Many large organisations are starting to demand their suppliers to reduce carbon footprints or to become more sustainable to become the remainder on the suppliers’ lease. So, besides cost consideration, the businesses also had to consider the competitiveness,” said Seng in an interview with the Singapore Business Review.

To even the playing field, the Singapore government provided support such as the $180-m (US$136m) Enterprise Sustainability Programme to help SMEs develop strategies, optimise resource usage, and invest in research and development.

Seng said companies must attract other talents and emphasise educating their workforce on sustainability topics, including the Singapore Green Plan and the United Nations’ 17 Sustainable Development Goals (SDGs).

They must also identify and deploy relevant technologies that are readily available and can achieve an immediate impact on their operations. These include transitioning into solar and hydrogen energy and using AI and machine learning analytics to adjust their energy consumption patterns and identify areas for optimisation.

“By coupling the transition to a green energy supply with the reduction of the demand or consumption pattern, companies will be able to translate to a low carbon operation,” Seng said.

Company action

For Siew Jin Kiat, Epson regional managing director, companies in Singapore are now purposefully making their products and services sustainable, as it is gaining traction in Asia.

In a separate interview with Singapore Business Review, Siew revealed that Epson’s regional office in Singapore is committed to meeting the SDGs by focusing on four key areas — decarbonisation, increasing recyclable materials, environmental mitigation for end users, and investing in green technology.

They also worked with third-party organisations for a campaign to increase awareness of global warming, including the World Wildlife Fund (WWF) on restoring the Coral Triangle area.

At the local level, Epson cooperated with the Singapore Fashion Council to promote sustainable textile creation and development.

“I think all of these, taken holistically, is how we are trying to push this sustainability and environmental agenda that is important for us into the midterm into the marketplace,” Siew said.

As for Schneider Electric, Seng said the company built a carbon-neutral mega logistics centre near Tuas Megaport that can contribute to their commitment towards net zero emissions.

He also cited the SME Kickstarter Decarbonisation Programme — Schneider Electric’s collaboration with Enterprise Singapore to support SMEs in moving towards a sustainable operation — which helped SMEs map out their carbon footprint and develop a roadmap for a more systematic approach to reducing it.

The government’s turn

With local businesses grappling with the tough decision to continue their investment in green technology and emission-reducing initiatives, the government must do its part in helping them remain committed to driving their operation toward sustainability.

However, Deputy Prime Minister and Minister for Finance Lawrence Wong did not mention any sustainability-related measures when he delivered the $104b (US$79b) spending plan last 14 February.

Seng said the government must allocate a part of the 2023 Budget to providing continuous support to SMEs to help them adopt efficient and sustainable technologies, thereby accelerating their progress toward decarbonisation.

It must also incentivise companies to start training and equip their workforce with relevant skill sets and knowledge. “To put together a concrete plan, as far as deploying it, we will need a workforce to be ready as well,” Seng said.

By combining the efforts of both public and private sectors, the sustainability transition of Singapore’s businesses will not be a short-term action but a long-term view.

“By taking a longer-term view, when we start to spread out the investment, it becomes a manageable cost to many companies in embarking on this sustainable journey,” Seng said.

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