Thailand Finance Ministry Approves TESG Fund
Permanent Secretary of the Thailand Ministry of Finance, Lavaron Sangsnit, recently announced the establishment of the inaugural Thai Environment and Social Governance (TESG) fund for Sustainability. The TESG fund is a joint venture with the Thai Securities and Exchange Commission (SEC) to provide financial support for various sustainable infrastructure development and climate impact projects.
The TESG is intended to incentivize green business practices among Thai enterprises on both the domestic and global scale through the introduction of a sizeable tax deduction for investors holding fund units for 8 years. The Permanent Secretary has expressed his faith in the viability of this model, stating that TESG investment will provide an important opportunity for Thai enterprises to become ESG compliant and contribute to ongoing national efforts to prioritize sustainability.
Although legislators anticipate significant revenue losses from such tax deductions, Director of the Thai Revenue Department, Kulya Tantitemit, has also conveyed her confidence in the value of the tradeoff between profit loss and sustainability improvement.