DNV covers such a broad array of services related to the energy transition, what are the mega trends driving change in Asia?
Asia has been following the same trends as Europe and North America, putting in place similar legislation and policies to implement the green transition. For example, in Singapore, the government introduced a Carbon Pricing Act in 2018 which imposes a carbon tax on certain industries for emissions. DNV is one of the accredited entities approved to verify emission claims and issue a verification report. Such Carbon laws also exist in other countries like Australia, Korea etc. These high level moves have a ripple effect in society at large and create a sense of urgency and responsibility. Companies are in a position in which they must make credible, data backed disclosures.
To what extent are companies adapting to new ESG regulations and what are some concrete examples of heightened demand in this space?
In addition to regulation taking a determined direction forward, companies are also certainly being proactive. Sustainable performance is now a board level agenda and a high priority item. Financial institutions are also paying close watch and asking for verifiable sustainability goals before committing capital. Such awareness, on the side of all entities involved, wasn’t really there five years ago and it is a very welcome mindset change.
To give you an example, at DNV we performed a project in which we employed digital technology to track and trace plastic coming from the ocean and were able to verify that products which claimed to be made from plastic coming from the ocean truly had their source from the ocean, such as caps or sunglasses etc. This helps to promote circularity. Another important trend is life cycle assessment, where we see growing awareness among industry players from manufacturing to distribution of a final product. Companies are paying attention to emissions created along the way and what can be done to reduce them.
Looking at the risk specifically, the landscape has changed from basic health and safety to areas such as cybersecurity - what do companies need to protect against the most?
Compared to past years, I would say that decarbonization is truly the number one risk area that companies need to watch out for because of the increasing regulations in place, and ensure they are fully compliant with. This is driven to a great extent by consumer awareness, as well as investors who are looking at business entities that have a long term perspective. Digitalization is a powerful tool in pushing these efforts forward and demonstrating reliable claims. Indeed, this comes as a package deal with a heightened cybersecurity risk, which must be addressed. The question in need of answer is how to protect one’s own data and ensure that your customers’ data is also in safe hands.
Singapore is at the epicenter of digitalization, which technologies have the strongest impact and are they being implemented at scale?
Companies are investing in new technology, yes, but they are also mindful of the implementation cost. For example, the data center industry is fast taking off in Singapore, an industry that uses vast amounts of energy for which a big scale shift is necessary. So we must ask ourselves, how can governments incentivize and support this transition?
Likewise, machine learning and AI are allowing us access to real time information. This is the direction the world is moving in, and it allows companies to improve their operations and change their course if needed.
Given the big shift in global supply chains, how have Asia’s policies and compliance adapted and are countries working well together?
Governments are collaborating with each other more than ever in Asia and we all live in a more integrated world. Legislation is often taken as an example from other governments and implemented locally, and we expect to see more of this trend. ASEAN is adapting versions of Singapore’s carbon tax regime. At DNV we were asked through the ADB to support in developing a Green Finance Taxonomy for the region. I believe that this is immensely positive and that governments are open to learning from each other for the betterment of society at large.
What is your vision for DNV in APAC for the coming few years?
Our ambition is to be a thought leader in the area of decarbonization and digital assurance space, assisting companies in our areas of expertise. Supply chains are in need of multiple third party verification and claims and we are there to ensure compliance to a variety of standards. We do this using digital technology that varies among different supply chain players, and this is something we are prioritizing. We must be at the forefront of the decarbonization and digital movement and believe that what we are able to do differently must be done now, not in 2025 or 2030.
