The Ministry of Finance and Economy building. Image: Ridhwan Kamarulzaman

Brunei pledged to align its legal and regulatory framework with two financial bond standards – Social Bond Standards (ASEAN SBS) and the ASEAN Sustainability Bond Standards (ASEAN SUS) .

The sultanate recently endorsed the standards at the recent ASEAN Capital Market Forum (ACMF) in Singapore along with Cambodia, Laos, Malaysia, Philippines, Singapore, Thailand and Vietnam, in its bid to promote sustainable finance in the region.

These standards were developed to enhance transparency, consistency and uniformity of ASEAN green, social and sustainability bonds aimed to reduce due diligence cost and assist global investors to make informed investment decisions.

In a statement from Autoriti Monetari Brunei Darussalam, it pledged to align Brunei’s legal and regulatory framework according to these new standards.

The central bank also encourages the application of the standards by potential issuers and welcomes issuances and sustainable financing for infrastructure development projects in the country.

Furthermore, the ASEAN SBS was developed based on the International Capital Market Association (ICMA)’s Social Bond Principles while the ASEAN SUS was based on ICMA’s Sustainability Bond Guidelines.

The ASEAN SUS is also is intended to provide guidance on the issuance of ASEAN SBS, where proceeds will be exclusively applied to finance or re-finance a combination of both Green and social projects that respectively offer environmental and social benefits.

These two standards were developed to complement the ASEAN Green Bond Standards launched in 2014, which have gained encouraging traction with five issuance from Malaysia and Singapore carrying the ASEAN Green Bond label.

In addition, the first sovereign sukuk in ASEAN issued by Indonesia is also aligned with the ASEAN Green Bond Standards, with ACMF and Asian Development Bank (ADB) are working together to promote this asset class to global investors.

The ASEAN Capital Market Conference is a platform for capital market regulators to exchange ideas, share insights, and collaborate amongst themselves and with industry experts to formulate actionable plans to drive the region’s agenda for deeper and more connected capital markets.

The second conference, themed “Sustainability and Connectivity”, was attended by over 300 participants from the region, ranging from asset owners, fund managers, market analysts and other stakeholders in the financial industry.

The Bruneian | BANDAR SERI BEGAWAN

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