SINGAPORE - Finance professionals now have a clearer picture of the types of skills they need for roles in sustainable finance, even as their industry continues to mobilise resources to tackle challenges posed by climate change.

The 12 technical skills and competencies set out by the Institute of Banking and Finance (IBF) and Monetary Authority of Singapore (MAS) on Wednesday (Feb 9) cover areas such as sustainability reporting and risk management, as well as carbon markets and decarbonisation strategies management.

Deputy Prime Minister Heng Swee Keat said financial institutions can use this framework to upskill their professionals, while the framework will also be an important reference for training providers.

"For example, asset managers will have to be proficient in analysing sustainable investment opportunities and integrate ESG (environmental, social and governance factors) into their investment approach," said Mr Heng at the opening of the new Wealth Management Institute (WMI) campus at One Marina Boulevard on Wednesday.

"This is in addition to having basic knowledge of climate and sustainable trends and their impact on the various sectors."

WMI, which was established in 2003, has trained over 8,000 private banking participants in the past three years.

The institute will launch an ESG certification programme for family office advisers next month to help them better design and implement ESG investment strategies.

It has also lined up additional ESG programmes for investors, private bankers and other stakeholders in the financial ecosystem over the next few months.

WMI aims to train over 1,000 finance professionals and investors in ESG competencies over the next three years.

Mr Heng said the world is facing major challenges and transitions, including the Covid-19 pandemic, the rapid advancement of technology, climate change and geopolitical contestation.

"The financial services sector will be impacted by these changes. But it can also play a key role in enabling a successful transition... As the pace of change quickens, we must redouble our efforts at transformation and invest even more in our people," he added.

The sustainable finance technical skills and competencies are part of the IBF Skills Framework for Financial Services, which provides information on occupations and job roles, career pathways and training programmes for professionals to upgrade and hone their skills.

The newly announced competencies cover thematic topics as well as those centred on functional knowledge.

Thematic topics include climate change policy developments, natural capital, green taxonomies, carbon markets and decarbonisation strategies.

Meanwhile, functional knowledge topics focus on how sustainability is applied across major functions in the financial sector. These include sustainability risk management, reporting and investment management, as well as sustainable insurance and reinsurance solutions.

MAS strongly encouraged financial institutions and training providers to design training programmes around relevant sustainable finance technical skills and competencies.

IBF will work with the industry to curate training programmes and onboard training providers whose curricula are aligned with the sustainable finance technical skills and competencies.

Participants who enrol in IBF-accredited training programmes can defray up to 90 per cent of training expenses under the IBF Standards Training Scheme grant.

MAS said the sustainable finance technical skills and competencies (SF TSCs) will be reviewed periodically to factor in evolving developments and needs in sustainable finance.

It said: "Future enhancements could include raising the competency standards for specific roles and introducing more SF TSCs for new job roles."