The Securities and Exchange Commission's (SEC) Philippine Green Equity Label has opened a new frontier for sustainable finance in Southeast Asia, and companies are taking notice. To qualify for the voluntary label, companies must derive more than half of their revenue and investments from green activities defined under the Philippine Sustainable Finance Taxonomy Guidelines or the ASEAN Taxonomy for Sustainable Finance.
Companies applying for the label must submit an independent external review assessment as part of the application process, while companies awarded the label are subject to annual compliance assessments by the Philippine Stock Exchange (PSE). This framework forms part of the regulator's broader sustainable finance initiatives and aims to help investors identify listed companies and firms preparing to go public whose business activities align with recognized sustainability taxonomies.
A recent launch by Sustainable Fitch will provide independent assessments for companies applying for the Philippine Green Equity Label. The external review service will help validate applicants' eligibility for the label and support transparency for investors. This move is part of Sustainable Fitch's global initiative to support emerging green and transition equity designation frameworks.
The company has deep experience using taxonomies in its analysis at both the entity and transaction levels, making it well-suited to perform external reviews for the label. It has also played a similar role in supporting Brazil's B3 Green Equities designation and is expanding its capabilities to cover comparable frameworks in other markets.
Sustainable Fitch provides sustainability assessments at the entity, framework, and instrument levels, including second-party opinions and sustainability ratings that help issuers and investors evaluate sustainability-related activities. This external review service is expected to unlock the full potential of the green equity label for issuers and investors in the region.
