Develop Thai Taxonomy
Promote the development of a national green taxonomy. The Thai Taxonomy will establish the definition of what economic activities are considered ‘green’ or ‘in transition’ in a manner that is appropriate and suitable to Thailand’s context. The taxonomy should help identify and promote allocation of resources towards those activities. Emphasis would initially be placed on industries that lag behind in the transition, especially those that emit large amounts of greenhouse gas. The Thai Taxonomy will also be aligned with the ASEAN Taxonomy as well as other internationally recognized taxonomies such as the EU Taxonomy and the Climate Bonds Taxonomy.
Set Disclosure Standards
Set disclosure standards so that financial institutions could show their commitments and actions on environmental sustainability in a manner that is clear and consistent with international standards such as those recommended by the Task Force on Climate-related Financial Disclosures (TCFD). The BOT will also collaborate with other regulatory agencies to encourage the adoption of disclosure standards among other financial players as well as non-financial businesses to make environment-related data more widely available in Thailand. The BOT will also consider the possibilities of pushing forth the creation of data platform to facilitate data connectivity and information sharing between different agencies, both within and outside the financial sector, to support the analyses and assessment of climate-related risks and opportunities.
Promote Financial Products to Support the Transition
Actively encourage the introduction of new financial services and products that would help businesses adapt and transition away from activities that are environmentally unsustainable. The BOT will collaborate with financial institutions to develop good practice guidelines including the conduct of scenario analysis as well as climate stress testing. This will encourage financial institutions to
- materially incorporate environmental consideration and risks into their risk management practices and day-to-day operations in a systematic manner; and
- design financial products and services that reflect those risks and support businesses in the transition towards more sustainable practices.
Create the Right Incentive Structures
Put in place mechanisms or measures to help alleviate the burden or cost of adjustments for financial institutions and businesses will facilitate a timelier transition. Particularly, the aim is to increase SME’s access to the financing they need to adjust and transition to a more sustainable practice. One example is Singapore’s grant scheme to help reduce the validation expense of green loans application.
Build Up Capacity of Financial Sector Personnel
Build competencies and skills in the financial sector. The BOT will collaborate and exchange views and experiences with other financial regulators and banking associations to build up the capacity of financial sector personnel so that they are equipped with competencies and skills to utilize the tools, appropriately assess climate-related risks and opportunities, and learn from experiences of experts in the fields, relevant agencies, and international communities.
For these actions to yield concrete outcomes, it will be necessary to have common objectives at the national level as well as integrated efforts from all parties involved as seen in the EU, China, South Korea, and Singapore. The BOT will therefore push for the implementation of these actions together with government agencies, the financial sector, businesses, and the general public in order to achieve our shared national goals.