Krungthai Bank and PTT Global Chemical have joined forces to develop a financial management solution aimed at addressing environmental, social, and governance (ESG) targets, or an ESG financial solution, in which liquidity and risk are managed through ESG-linked derivatives. This collaborative effort is expected to reduce costs and contribute to addressing the net-zero target under the strategy "Together to Net Zero" and the sustainable business agenda.
Rawin Boonyanusasna, Senior Executive Vice President of the Global Markets Group at Krungthai Bank, said that Krungthai Bank is committed to developing financial and investment innovations that not only meet customer needs in different market conditions but also support sustainable development and the integration of ESG principles into business practices. In line with this commitment, the bank has recently partnered with PTT Global Chemical Public Company Limited (GC) to use financial instruments to support GC's sustainable investing agenda by considering investing in assets that align with ESG investing for liquidity management purposes and entering into ESG-linked derivative agreement, which is considered an ESG for ESG solution. It is designed to measure the performance of ESG operations and pass on the benefits received to ESG investing. This is the first time that the ESG agenda is integrated into liquidity and risk management, and it is a crucial step that will support both organizations to achieve sustainability goals and net-zero targets together.
Rawin stated, "This marks the first time Krungthai Bank has utilized a diverse range of financial instruments to address ESG objectives. It is a significant milestone in propelling both organizations toward sustainable development goals. Moreover, it reinforces Krungthai Bank's position as a leading provider of ESG financial solutions, both for liquidity and investment management, that effectively cater to the specific business needs of its customers, while addressing the United Nations' Sustainable Development Goal 13: Climate Action. All of this aligns with our vision of 'Growing Together for Sustainability.'"
Pattaralada Sa-ngasan, Executive Vice President of Finance and Accounting at PTT Global Chemical Public Company Limited (GC) said that the company focuses on sound financial and risk management practices, along with its commitment to integrating the United Nations' Sustainable Development Goals into its operations, aiming to achieve balance across three dimensions: environmental, social, and governance (ESG). To this end, the company has adopted a sustainable business approach in its investment policy, strategically investing in assets that align with ESG principles and fall within its risk appetite. As part of the ESG-linked derivative deal with Krungthai Bank, specific ESG targets have been established, and the fee discounts received upon reaching these targets will be allocated towards the company's ESG investing policy. This showcases the company's comprehensive integration of ESG principles across all aspects of financial management, which aligns with its sustainable growth strategy.