Sustainable Finance: Future-proofing the Built Environment

As climate change is no longer a distant threat but a present reality, the built environment must evolve to meet the challenges of sustainability and resilience. Sustainable finance emerges as a crucial tool in this transformation, guiding investments towards projects that not only promise financial returns, but also deliver environmental and social benefits.

To delve deeper into this topic, I spoke with Michelle Loi, Principal Consultant of Sustainable Finance from South Pole, a globally recognised climate consultancy and carbon projects expert. Sustainable finance, as Michelle explains, integrates environmental, social and governance (ESG) factors into financial decision-making for businesses. “It’s about moving more money into investments that support sustainable projects and activities,” she says.

This approach plays a catalytic role in ensuring that financial institutions and companies consider the broader impact of their investments beyond just financial bottom line. By factoring in elements like waste management, pollution levels, water usage and carbon emissions, sustainable finance orientates companies towards considering long-term climate risk management and making positive societal impact.

Michelle highlights how Green bonds and sustainability-linked loans can be instrumental in funding Green building projects. “Green bonds specifically encourage projects with positive environmental benefits, such as energy-efficient designs and incorporating renewable energy technologies.” In return, these financial instruments lower the capital developers needed to fork out, making it feasible to invest in eco-friendly developments.

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Sustainability-linked loans, on the other hand, offer favourable interest rates to borrowers who meet specific sustainability criteria. This incentivises property developers and fund managers to prioritise sustainability in both new developments and existing buildings. “For instance, a developer might receive a lower interest rate if they reduce their carbon footprint by a certain percentage or achieve a recognised Green Building Standard,” Michelle explains.

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Ian Tan tells stories about the urban environment we live in. He uses his understanding of cultural heritage, placemaking and conservation to do so. Through interactions with other built environment professionals, he is also inspired by emerging technologies, innovative building solutions and new design strategies that can create a more liveable and inclusive environment for all. He has a PhD in Architecture and currently works at Arup, a global sustainable development consultancy.

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