South Korea has been a great experience for our family since relocating here with HSBC in late 2018. Our daughter who recently turned four is happily growing up. 

For those who know me, I’ve always been a big believer that one can learn a lot from kids. From the endless creativity and ever more sophisticated negotiating skills to little things they learn from school, the thought-provoking interactions often provide valuable reflections on life and how we should think about future generations. 

One such instance happened a couple weeks back when our daughter pointed to a plastic bottle and said, “Daddy, we must recycle otherwise the Earth will get sick!” Impressive, I thought. 

Eventually, this led to lengthy conversations with my colleagues that Korea, the country well known for successfully dealing with numerous challenges at pace, too cannot avoid climate change.

Climate crisis is one of the hottest topics in Korea right now. The intense interest from companies and media was sparked by the Korean government when it announced a plan to achieve net zero by 2050 in October 2020. Almost every day, we hear news of Korean companies announcing net zero management goals or launching products to combat climate change. Most notably, local banks seem to be paying the greatest attention to the climate issue with most of them prioritizing environmental risks in their risk profile and setting up ESG committees within their boards.

Some may ask “why banks?” Simply put, banks have a responsibility to be catalysts for change, supporting companies to transition to the net zero economy -- transition toward a more sustainable future requires finance and investment at scale. 

Specifically, the inter-governmental Panel on Climate Change says that a little under $3 trillion of investment is needed each year to limit global warming to 2 degrees Celsius. 

In addition, a recent study by Imperial College in London estimated that the current climate finance market is around $800 billion a year. 

In fact, the financial services sector has set ambitious net zero targets and committed trillions toward the transition. For example, HSBC which has been leading the global sustainability agenda for a long time, declared its intention last year to make its entire customer portfolio carbon neutral by 2050 by committing up to $1 trillion in financing to support this goal, in addition to making its own operations and supply chain net zero by 2030.

The bank also invests heavily in new solutions and technologies to accelerate decarbonization. 

The good news is that climate change is not only one of the most significant challenges of our time, but also the greatest business opportunity of our time. For instance, the Korean government’s Green New Deal presents a wide range of new opportunities for businesses of all sizes. They are opportunities to save our planet and devise innovative solutions. 

It is the financial services industry that can speed up positive change by connecting the opportunities to businesses. 

Let us work together to leave the world in a better place for future generations. Let’s not make the Earth sick.

Jonathan Yip, who joined HSBC in 2008, was appointed to a new head of global banking for HSBC Korea in February. -- Ed