Thailand hits data barrier in sustainable finance push

Framework launched in 2023 spans 6 industries, giving markets a shared language from energy to agriculture.

Thailand is accelerating its push to become a regional leader in sustainable finance, underpinned by clearer ESG standards, growing bank commitments, and a pragmatic approach to transition finance that aligns climate goals with economic realities.

The country now has a National Sustainable Finance Taxonomy, with sector-level transition guidelines under development and strong capital mobilisation from major lenders. Siam Commercial Bank has mobilised US$180 billion in sustainable finance in just two and a half years, surpassing its target, while Kasikornbank and Krungthai Bank have each doubled their 2030 targets to US$500 billion and US$250 billion respectively.

“These are all clear signals of market readiness,” said Nikki Kemp, Executive Director of the Singapore Green Finance Centre (SGFC). She added that “ASEAN's pragmatic transition pathways are an economic imperative, and Thailand is exemplifying this by prioritising decarbonisation strategies to meet its own economic realities in manufacturing, resilience, energy transformation, logistics efficiency and supply chain upgrading.”

According to Kemp, Thailand’s progress is particularly important for investor confidence. “It's all about the investors and making sure that the capital flows and investor confidence grows in ESG with clear definitions, credible Transition Plans and transparent data,” she said. “Thailand is making really good progress across all three of these elements.”

Launched in 2023, Thailand’s taxonomy aligns closely with ASEAN-level frameworks and provides investors with “a common language to assess how green projects are,” covering six key sectors: energy, transport, manufacturing, construction, water and waste, and agriculture. “The Thai taxonomy is really applicable across the whole economy,” Kemp said, noting that banks, corporates, insurers, and regulators are all using it to structure products, develop transition plans, and design incentives.

However, challenges remain. Kemp highlighted data quality as a major constraint, especially among SMEs. “ESG data is often inconsistent, and especially amongst SMEs, where it's very difficult to extract or for SMEs to even compile that data,” she said, stressing that the focus should be on “fit for purpose” data rather than perfection.

Hard-to-abate sectors and skills gaps also threaten momentum. SGFC is addressing these through research and education, including a Thai-language MOOC that saw strong uptake. Kemp said strategic understanding at the C-suite and policymaker level is now critical to sustain Thailand’s transition from ambition to implementation.