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      Recognising the role that Singapore’s charity sector plays in advancing the country’s environmental, social and governance (ESG) agenda, KPMG in Singapore, in collaboration with the Ministry of Culture, Community and Youth, has launched an ESG Playbook for Charities, serving as a guide for these organisations to kickstart their ESG journeys. This essential guide aims to support over 2,300 charities and Institutions of Public Character (IPCs) in Singapore.

      The playbook is meticulously crafted to address the diverse maturity levels of charities, offering a structured pathway for integrating ESG principles into their operations. It provides a spectrum of actionable steps and industry best practices, enabling organisations to effectively navigate their unique challenges. This tailored approach not only supports operational alignment with sustainability goals but also equips charities with the tools to enhance their strategic capabilities and stakeholder engagement. By focusing on these key areas, the playbook positions charities to excel in governance and impact, making them more attractive partners for corporate donors with a strong commitment to ESG values.

      Cherine Fok, Partner, ESG Consulting, KPMG in Singapore said: “While the social aspect naturally resonates with the social sector, the playbook urges charities to think bigger and how they can deepen the impact they have on the communities they serve. By adopting strong ESG practices, charities can boost public trust, improve their governance, and build trust. This will not only benefit charities but also positions them as attractive partners for corporate donors with strong ESG goals and strategies.”

      As ESG principles increasingly serve as critical metrics for investors and policymakers in evaluating organisational success, this initiative aligns seamlessly with Singapore’s aspiration to become a regional philanthropy hub. By embracing these practices, charities not only support national sustainability goals but also solidify their competitive stance in the philanthropic landscape.

      The annex below outlines how charities can embark on their ESG journeys to maximise their impact.

      ESG Playbook for Charities

      (From left - right): Lee Sze Yeng, Managing Partner, KPMG in Singapore; Edwin Tong, Minister for Culture, Community and Youth; Sharad Somani, Partner, Head of KPMG ESG, KPMG in Singapore; Cherine Fok, Partner, ESG Consulting, KPMG in Singapore

      How can Charities embark on ESG?

      Stage 1: Integrating ESG into the board agenda

       

      Boards need to recognise that sustainability is not a temporary trend but a vital component of Charities’ long-term success that requires sustainability to be included into Charities’ core strategies and board agenda.

      Charities can integrate ESG into their board agenda and risk management by:

      • Establishing an ESG governance structure and designating responsibilities for overseeing and managing ESG (p.9)
      • Integrating ESG into their existing Enterprise Risk Management framework (p.11)

      Stage 2: Define ESG strategy

       

      A well-defined ESG strategy can help Charities achieve their ESG goals. By creating a coherent ESG strategy, Charities can assess their current ESG status, define their future aspirations, and identify the necessary actions they need to take.

      Charities can develop an ESG strategy through:

      • Identifying and prioritising ESG topics that matter most to them and their stakeholders through a variety of stakeholder engagement methods (p.13)
      • Assessing current ESG maturity level by conducting an assessment to identify actions necessary to reach their goals (p.15)
      • Setting ambitions for ESG action by considering their stakeholder expectations, alignment with its missions and values, by identifying priority ESG areas, and the resources and capabilities required to achieve that target (p.15)

      Stage 3: Drive ESG initiatives

       

      With the ESG strategy now in place, the next step is to implement ESG initiatives. Charities may have a strong track record in the social aspect of ESG, but they may be less familiar with the environmental aspect, and hence may want to prioritise environmental-related initiatives such as decarbonisation.

      Charities should drive ESG initiatives by:

      • Ensuring that the initiatives are aligned to their ESG strategies (p.19)
      • Aligning the goals and outcomes of the ESG initiative with the Charity’s priorities, define clear roles and responsibilities, invest in training, engage stakeholders to gather feedback, as well as monitor progress and communicate the outcomes. (p.19)

      Stage 4: Communicate ESG Performance

       

      Charities are also encouraged to disclose ESG-related information to communicate their ESG practices and efforts to donors, beneficiaries, employees and communities.

      Charities can communicate their ESG performance by:

      • Understanding the different ways on how to communicate ESG performance and what should be communicated. Some methods include sustainability or annual reports, policies, or publicity materials. (p.20)
      • Aligning to established sustainability reporting frameworks (p.22)
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