The National University of Singapore (NUS), in collaboration with Northern Trust and UOB, has launched an initiative to tokenize green bond credentials. This marks a significant development in the use of blockchain technology for environmental, social, and governance (ESG) reporting. NUS is the first university in Singapore to adopt such technology for this purpose.
This initiative aims to improve transparency, data integrity, and investor confidence in sustainable investments by using blockchain technology. Typically, issuers of green bonds provide updates on fund usage to investors who need this information for their sustainability reporting and ESG goals assessment.
Northern Trust will utilize its Matrix Zenith digital assets platform to create and manage a green bond reporting token containing environmental impact data from NUS's third green bond issued in 2023. UOB will lead the arrangement of the bond issuance and gather feedback on how tokenized data can enhance sustainability reporting practices.
The process ensures that investors receive secure and immutable data for their sustainability obligations. The same complete set of information will be available even if the bond changes ownership. This step aligns green finance practices with global transparency standards.
The project is part of Project Guardian, led by the Monetary Authority of Singapore, which aims to improve financial market liquidity through asset tokenization under its fixed income workstream.
Mr Tan Kian Woo from NUS stated: "We are proud to be leading this first-in-market green bond reporting tokenisation initiative in partnership with Northern Trust and UOB." Mr Koh Yan Leng added: "Through this project, investors and stakeholders will get access to prompt updates to support their sustainability reporting needs."
Justin Chapman from Northern Trust commented: "This initiative is a testament to the transformative potential of blockchain technology in green finance." Edmund Leong from UOB remarked: "By participating in this data tokenisation initiative, we aim to provide real-world feedback on the usability of tokenised data."
NUS plans further exploration into how blockchain can enhance green finance practices through a three-year Memorandum of Understanding signed with Northern Trust. This collaboration focuses on research and developing solutions for ESG finance challenges.
For more details about NUS’s initiatives, visit https://sustainability.nus.edu.sg/campus/green-finance/.