On March 30, 2021, finance ministers and central bank governors from members of the Association of Southeast Asian Nations (ASEAN) announced their support for an ASEAN Taxonomy of Sustainable Finance (ASEAN Taxonomy). Like the Taxonomy Regulation in the European Union, the ASEAN Taxonomy will serve as ASEAN’s common language for sustainable finance and account for both international goals and ASEAN’s specific needs. The initiative is supported by a range of ASEAN bodies, including its Capital Markets Forum, Insurance Regulators’ Meeting, Senior Level Committee on Financial Integration and Working Committee on Capital Market Development.

According to the announcement, the ASEAN Taxonomy will complement the respective sustainability initiatives of individual ASEAN nations. Importantly, national taxonomies are currently contemplated in Singapore and Malaysia, and it remains to be seen exactly how the ASEAN Taxonomy will relate to these initiatives.

The group has endorsed the establishment of an ASEAN Taxonomy Board to develop, maintain and promote the ASEAN Taxonomy. An announcement on the progress of the development of the ASEAN Taxonomy is expected by the end of 2021.