26 May 2017
RAM Ratings supports the Asian Development Bank (ADB) and World Wildlife Fund (WWF) initiated ‘Hanoi Principles for Sustainable Infrastructure’, mooted at the International Forum on Sustainable Infrastructure held in Hanoi, Vietnam on 18 May 2017. According to ADB, developing Asia will need to invest US$26 trillion in this effort from 2016 to 2030, or US$1.7 trillion per year, if the region is to maintain its growth momentum, eradicate poverty and respond to climate change.
In response to this rapid buildup of infrastructure, ADB, WWF and international experts including RAM Ratings, representing the environmental and financial ecosystems, had conceptualised the ‘Hanoi Principles for Sustainable Infrastructure’ to develop key guiding principles within 2 years or less to drive sustainable infrastructure. “It is imperative for the financial sector to consider all material risks, including environmental, social and governance (ESG) factors in their lending or investment assessment criteria as part of a comprehensive due diligence process,” Promod Dass, Deputy CEO of RAM Ratings, said during a panel session on facilitating finance for sustainable infrastructure.
The forum concluded that sustainable infrastructure could only materialise if a multi-stakeholder approach is adopted from the onset, with the government, the private sector and sustainability experts working in close collaboration. “Having RAM Ratings – ASEAN’s leading credit rating agency – championing sustainable finance and infrastructure, will have a catalytic effect,” highlights Kate Newman, Vice President, Forest Public Sector Initiatives, WWF US. RAM pioneered project finance ratings in Malaysia, having rated the country’s first independent power producer and toll road bonds in 1993. We have since rated a cumulative total of approximately US$40 billion in power sector and toll road bonds and sukuk. Beyond this, RAM has built a track record of rating telecommunication companies, private-public-partnership infrastructure, and a range of corporates, insurers and banks.
“Pension and institutional funds, banks, insurance companies and credit rating agencies are part of the solution,” points out Bruce Dunn, Principal Environment Specialist – Environment and Safeguards Division, Sustainable Development and Climate Change Department, ADB. This is important, given that in the period between 2016 and 2030, Asia will see investments (based on ADB’s projections) amounting to US$14.7 trillion in power, US$8.4 trillion in transportation, US$2.3 trillion in telecommunications and US$800 billion in water and sanitation – all sectors that typically seek long-term funding in both domestic and international bond markets.
RAM is an active proponent of and a thought leader on sustainability. On 26 May 2016, RAM joined the line-up of 6 pioneer credit rating agency signatories to the United Nations-supported Principles for Responsible Investment’s Statement on ESG in Credit Ratings. RAM was also among international stakeholders involved in the formulation of ‘Bellagio Call to Action’ on 17 June 2016 – an initiative to encourage sustainable and resilient infrastructure – mooted by the Switzerland-based Global Infrastructure Basel Foundation. In February 2017, RAM’s sister company, RAM Consultancy, introduced Sustainability Rating to drive and encourage corporate sustainability.
For forum details, please click on: https://storify.com/ADBEnvironment/infra-forum-hanoi-2017
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Copyright 2017 by RAM Rating Services Berhad
© Press Release 2017