Partnerships drive sustainable finance

Partnerships drive sustainable finance

The partnership between Standard Chartered and Goertek demonstrates how environmental, social, and governance principles can be embedded into the fabric of everyday financial transactions. In an exclusive interview with VIR’s Vy Vy, Nguyen Thuy Hanh, CEO of Standard Chartered Vietnam, and Eric Zhang, deputy general director and CFO of Goertek Vietnam, share why leadership is defined by the courage to act.

Standard Chartered’s first sustainable account for Goertek represents a significant push in its environmental, social, and governance (ESG) journey. What is the greatest value of this initiative, and what does it mean for organisations in Vietnam looking to embark on their own ESG journey?

(L-R) Nguyen Thuy Hanh, CEO of Standard Chartered Vietnam, and Eric Zhang, deputy general director and CFO of Goertek Vietnam

Hanh: Standard Chartered’s Sustainable Account is designed to help our corporate clients embed sustainability into their cash management practices. It provides organisations with an opportunity to participate in sustainable development by having their surplus cash referenced against Standard Chartered’s sustainable loans and projects.

Through the Sustainable Account, each transaction is no longer just the movement of funds, but becomes a step forward in the company’s journey to net-zero.

Nearly 80 per cent of the assets where the cash in a Standard Chartered Sustainable Account is referenced against are in Asia, Africa, and the Middle East. This includes a number of assets in Vietnam.

In the case of Goertek, they have transformed their internal financial system into a tool for executing their ESG strategy, which involves their factories in Vietnam to partners worldwide.

Vietnam is emerging as a pivotal launchpad for sustainable finance in the wider region. Standard Chartered is already deeply engaged with Vietnam’s green transition through initiatives like the Just Energy Transition Partnership, and we are committed to supporting further sustainable growth through the bank’s extensive suite of relevant finance products and advisory services.

What made Goertek choose Standard Chartered as its partner in this pioneering project?

Eric: We highly recognise Standard Chartered’s business advantages in emerging markets and the professional capabilities it has demonstrated in the cross-border finance sector.

Standard Chartered’s experience in supporting their clients, such as their role in the development of an international financial centre in Vietnam, demonstrates their business capabilities and localisation advantages, which we required as an important factor to support Goertek’s development.

Standard Chartered’s heightened awareness and expertise in ESG is also one of the reasons why Goertek Vietnam has chosen to cooperate with the bank.

We have seen that Standard Chartered has set a clear vision and ambition to mobilise sustainable finance, especially in terms of carbon emissions, and has disclosed detailed action measures in its Sustainable Finance Impact Report, which has resonated strongly with us.

Furthermore, Standard Chartered also believes in cooperating with both clients and partners to promote a more inclusive approach to sustainable finance, which will contribute to achieving Vietnam’s 2050 net-zero emission targets.

As a partner of Standard Chartered, Goertek is keen to gather valuable experience in the process of supporting Vietnam’s sustainable development projects, which will in turn lay a foundation for the achievement of our own ESG goals.

A representative from Goertek Vietnam receives an honour for the company’s sustainable development journey

As Goertek adopts this model, can we expect a domino effect that encourages suppliers and partners to integrate sustainability principles into their own financial and operational practices?

Hanh: The adoption of the Sustainable Account demonstrates Goertek’s commitment to sustainability to its stakeholders. We expect to see more suppliers and partners across the ecosystem align with ESG standards, especially when adoption is driven top-down.

Eric: We are driven by our goal to continuously strengthen our ESG performance. Guided by the priorities of both internal and external stakeholders while also being aligned with the company’s business strategy, we have identified important focus areas that will maximise positive outcomes for both our business and ESG strategies.

For each key focus area, we have implemented a closed-loop management approach covering development plans, goals, and action pathways, as well as indicator tracking, and will continue to refine and enhance outcomes based on existing strategic plans.

As we look to enhance our ESG performance, we remain committed to generating and sharing value with stakeholders, while strengthening the company’s competitive advantages.

One of the key challenges in ESG is turning commitments into measurable actions. How does the Sustainable Account address this by embedding sustainability into everyday financial transactions?

Hanh: The Sustainable Account delivers a distinctive value proposition to clients by combining flexibility, transparency, and a strong commitment to sustainability. It offers flexibility by allowing clients to enjoy the benefits of a current account, maintaining access to daily cash for intraday liquidity needs without locking funds as compared to a time deposit.

At the same time, clients can use their short-term surplus cash to support the UN’s Sustainable Development Goals, thereby aligning their liquidity management with global sustainability efforts.

Transparency is ensured through the alignment of referenced loans and projects with Standard Chartered’s Green and Sustainable Framework, which is independently assessed by Sustainalytics. Standard Chartered’s sustainable assets are assured by a third party annually to ensure that they align with the framework.

What is your approach to transforming compliance into a competitive edge?

Eric: We measure progress through goal-setting and metric tracking.

Using the example of sustainable supply chains, we have incorporated ESG considerations into both supplier onboarding and post-onboarding management. We evaluate suppliers’ environmental and social risks as well as their green environmental management systems through written reviews and on-site audits on an annual basis.

The evaluation criteria include employee rights, health and safety, environmental protection, and business ethics. After the evaluation, we follow up with suppliers for them to submit improvement plans, and ultimately review and verify rectification outcomes to achieve closed-loop management.

In the context of sustainable supply chains, we continuously practice and promote the realisation of carbon emission reduction management in the supply chain through supplier training and on-site reviews.

In relation to responsible mining, Goertek conducts supply chain due diligence to ensure that smelters or refiners are included in the RMAP (Responsible Minerals Assurance Process) list. Suppliers who have not obtained the necessary certification and those who fail to complete rectification requirements within the specified period are removed from the supplier pool.

To drive carbon emission reduction and energy management, Goertek has established its carbon emission and energy management goals which include a short-term goal for 2025-2026 and a long-term goal for 2030-2050.

The short-term goal strives to achieve 30 per cent of renewable energy share and includes building a digital energy and carbon management platform. The long-term goal aspires to peak carbon emissions within the operating boundaries by 2030 and achieve carbon neutrality no later than 2050.

Goertek also pays close attention to industry trends in sustainable materials and actively implements them in its operations. Some of the sustainable materials and practices which are implemented in raw product materials include recycled aluminium, injection-molded particles, and reduction of plastic packaging.

All these measures are a demonstration of how we are committed to driving progress and advancing our ESG journey.

VIR