The concept of sustainability is not easy to understand. This isn’t a supposition, but the professional opinion of Lee Weilin, who affirms that sustainability issues are broad and complex.
“I always start by explaining that sustainability is reallocating scarce resources to make it work for all of us for a longer term. Even then, it’s difficult for people to understand why so many more sacrifices and costs need to be put into what should have been free public goods like clean air, drinkable water, and the environment,” says the 42-year-old.
Conceivably, corporate sustainability is a tougher nut to crack. But given that it has to do with the long-term survival of a corporation, Lee has seen an uptick in sustainable financing transactions in recent months. Generally categorised into green loans, social loans, and sustainability-linked loans, sustainable financing is based on market principles and governed by formal guidelines.
As part of her role, she advises clients on loan structure and explains how these loans must be sustainable or green. “It’s not just paying lip service to the market principles. When a corporation takes a sustainability-linked loan, it is required to set KPI targets, and they typically follow the business trajectory so they are achievable. However, the purpose is to have targets that are ambitious and beyond business-as-usual because there should be an element of additionality. The impact should be greater than if the loan had not been granted.”
She adds that these concepts are complicated because of cost considerations, concerns about whether targets can be reached, and the consequences when they aren’t. They range from contractual consequences to stakeholders’ expectations and financial impact.
“As such, representing corporations comes down to understanding their day-to-day operations and putting in place safeguards and processes to make sure they are able to comply with the sustainable loan principles.”
Lawyering is notoriously arduous and practising in the sustainability sector is no different. Some of the challenges she faces in her role, admits Lee, overlap with those in sustainability because the issues can be “far-reaching and very different for different entities or stakeholders”.
Moreover, she has to keep up with the latest developments and the innovations to achieve them, and continuously evaluates the legal position of clients. This is especially the case when developments are so new that laws have not been passed to cover them—a deep understanding of existing laws is first required to see if they can have wider applications on the new innovations.
But Lee wouldn’t have it any other way. She was inspired to make a greater difference to the community and humanity after observing that nature flourished when human activities decreased during the circuit breaker. As such, she decided on the “win-win arrangement” of corporate sustainability. It allows her to both exact change and help businesses thrive.
“When a corporation takes sustainability issues into consideration, it has considered if environmental and social issues have an impact on its assets and investments, and whether there is good governance to set out the processes and systems in place,” she says.
“From a long-term perspective, if a corporation does not start making a switch to more sustainable business lines or own green assets, there may come a point where its value of assets or businesses may be completely written off by the market. They become stranded in the sense that no investors would be willing to invest. In turn, banks may not wish to lend to a corporation with stranded assets.”
Art director: Chia Wei Choong
Videographer: Yvonne Isabelle Ling
Photographer: Cher Him
Photographer’s assistant: Glin
Hair: Peter Lee, using Goldwell
Makeup: Keith Bryant Lee, using Shiseido
