Standard Chartered has introduced a new ESG-linked Cash Account for its corporate banking clients, designed to reward them for achieving environmental, social, and governance (ESG) targets. This innovative solution will be initially rolled out in Hong Kong, with plans to expand to other markets gradually.

Key Features and Implementation

The ESG-linked Cash Account integrates the credit balance interest rate and/or fee pricing with the client’s ESG performance. To qualify, the selected key performance indicators (KPIs) must be material and relevant to the client’s business, and targets should be ambitious compared to external benchmarks, peers, or the client’s previous performance.

Expansion of ESG Offerings

This new account builds on Standard Chartered’s existing Transaction Banking solutions. These include the Sustainable Account, which allows clients to use surplus cash for activities supporting the United Nations Sustainable Development Goals; the Sustainable Trade Finance Proposition, which aids clients in adopting sustainable practices; and the Sustainable Financial Institution Trade Loan, which provides liquidity to support trade flows related to sustainable development.

Commitment to Sustainability

Mahesh Kini, Global Head of Cash Management at Standard Chartered, emphasized the role of banks in supporting companies’ sustainability efforts. “The launch of our ESG-linked Cash Account is another testament to our commitment to offering solutions that help clients achieve their treasury and sustainability goals,” Kini stated.

The ESG-linked Cash Account will first launch in Hong Kong and Singapore, with plans for further expansion to other markets in the near future.