At the beginning of the year, the Net-Zero Banking Alliance (NZBA) caught up with Luanne Sieh of CIMB Group for the first in a series of interviews with finance professionals from different departments.
Luanne is the Group Chief Sustainability Officer at CIMB, a leading Southeast Asian bank, one of Asia’s largest investment banks, and one of the world’s largest Islamic banks, and has been leading sustainability at the bank for the last six years. She shared her inspirations, frustrations, recent achievements, and predictions for 2024.
Tell us about your role. What does a typical day look like for you?
As the Group Chief Sustainability Officer for CIMB, I oversee sustainability matters end-to-end within the organisation, starting from our own footprint, employees, and extending to our clients. This includes managing environmental and social risks in transactions and the overall client portfolio, as well as collaborating with various units to introduce innovative products and services. I also oversee the overall governance of sustainability and stakeholder engagement, which involves internal capacity building and managing relationships with external stakeholders such as regulators and investors.
There isn’t really a typical day. My schedule may involve discussions with clients, presenting policy changes – like our No Deforestation, No Peat, and No Exploitation (NDPE) policy to the board, discussing sustainability progress and challenges with my team in Cambodia, attending meetings for the Malaysian Master Builders Association’s Sustainability Committee, and participating in UNEP FI Principles for Responsible Banking visioning for the next 5 to 10 years. In the evenings, I may meet with my mentees.
What do you love about your job?
I love that I am contributing to creating tangible positive impacts in the world, a departure from merely increasing the wealth of the well-to-do as, as I did in my previous role as a banker. It’s a privilege to work in such a pivotal moment in human history. Initially daunting, taking on this role made me realise that while I didn’t (and still don’t) know everything, in most areas I just needed to know enough to drive change within the bank and with our clients as a start.
It’s great to see sustainability becoming more mainstream, a far cry from when I started six years ago, wondering if sustainability would remain a core strategy under the then-new CEO.
What climate-related reading or listening do you recommend for insight or inspiration?
I get a lot of my news and reading from LinkedIn. I follow key figures like David Carlin, who heads climate risk at UNEP FI, and Jakob Thoma, the founder of 2° Investing Initiative. For insightful content, I often turn to Eco-Business, a Singapore-based publication centered on sustainability, and, of course, I regularly read The Guardian for its coverage on these crucial topics!
What is your biggest recent climate-related professional achievement?
One of our biggest recent accomplishments at CIMB was establishing science-based net-zero targets for our palm oil portfolio. We hold the proud distinction of being the first bank in the world to set such targets guided by the SBTi Forest Land and Agriculture (FLAG) palm oil pathway. Palm oil, known for its affordability and efficiency, has faced controversy due to its association with deforestation. However, stringent industry regulations and efforts have reduced deforestation rates to near record-low levels, with the world’s major producers Indonesia and Malaysia seeing average reductions of up to 64% and 57% in recent years.
Setting this target was challenging. In addition to addressing limitations in terms of data availability, granularity, and accuracy, it required a lot of engagement to better understand how we can practically play our part in a transition which requires the participation of more than three million smallholder farmers in the region. Balancing ambition with feasibility was crucial, especially since the smallholders are not direct clients of ours. My advice for anyone undertaking similar goals would be to engage extensively with stakeholders, clients, and NGOs to understand the challenges on the ground and how to overcome them.
“One of our biggest recent accomplishments at CIMB was establishing science-based net-zero targets for our palm oil portfolio. We hold the proud distinction of being the first bank in the world to set such targets guided by the SBTi Forest Land and Agriculture (FLAG) palm oil pathway.”
What trends and innovations do you see emerging in the next twelve months?
I predict a surge in interest in nature-based solutions and biodiversity, issues relevant for the many banks in emerging countries that are abundant in biodiversity. Various national governments are in the process of formulating biodiversity policies, largely influenced by recent agreements like the Kunming Montreal Global Biodiversity Framework. Similar to the gradual establishment of frameworks like the Task Force for Climate-Related Financial Disclosures (TCFD) for climate, we’re witnessing similar developments for biodiversity, such as the Taskforce on Nature-related Financial Disclosures (TNFD).
At CIMB, we’re in the initial stages of developing biodiversity strategies, particularly at the portfolio level. Acknowledging the link between deforestation and biodiversity loss, we’ve taken the proactive step of implementing the NDPE policy as our first no-regret move, while figuring out how to apply the emerging frameworks and guidance for measuring biodiversity at a portfolio level.
“I predict a surge in interest in nature-based solutions and biodiversity, issues relevant for the many banks in emerging countries that are abundant in biodiversity.”
What one thing do you wish your colleagues and regulators better understood about your role and how it relates to climate?
Firstly, I don’t believe most people truly understand the gravity of our current climate situation and its potential repercussions in the coming decades. Despite increased media coverage, many fail to grasp the urgency and scale of action required. Consequently, when facing tough decisions, we often encounter feedback from regulators, clients, and others suggesting a lack of readiness or asking to slow the pace of change or reduce ambition.
Secondly, there’s an over-reliance and misplaced hope in emerging technological solutions such as carbon capture. While such innovations hold promise, there’s a very real risk that they divert attention from existing proven solutions like renewable energy, energy efficiency, and methane reduction. These established solutions are readily available and staring us in the face, offering tangible paths toward tackling climate change. Focusing excessively on cool and new innovations that are technologically feasible but may not be economically feasible or scalable may overshadow the urgency of implementing the solutions that already exist.
What inspires you to work on climate? How do you think about your contribution?
I’ve always been driven by challenges and addressing climate change presents the biggest challenge humanity has ever faced! When I talk to people who are starting out, I ask if they want to spend their entire working lives making money for those who already have plenty – similar to most corporate jobs. I find that working on climate utilises the remaining hours I have on this planet for something profoundly meaningful, not just for myself but for those around me.
The Net-Zero Banking Alliance (NZBA) is a group of leading global banks committed to financing ambitious climate action to transition the real economy to net-zero greenhouse gas emissions by 2050. It is the climate accelerator for UNEP FI’s Principles for Responsible Banking (PRB) and the sector-specific alliance for banks under the Glasgow Financial Alliance for Net Zero (GFANZ). Is your bank interested in joining? Find out more here.
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Disclaimer: The views and opinions expressed here are those of interviewees and do not necessarily represent the views or opinions of their employer companies and affiliate companies, NZBA, PRB, or UNEP FI.