Photo of Vera Liu, Lai Kok Peng and Yasemin Stubbe, IHH Healthcare.
Lai Kok Peng
Group Head of Treasury
Yasemin Stubbe
Group Chief Sustainability Officer
IHH Healthcare (IHH) is one of the world’s largest private healthcare groups. It operates an integrated network of world class hospitals, primary care clinics, laboratories and ambulatory services spanning Asia and Europe. The group has over 70,000 employees across 80 hospitals in ten countries. It is listed on Bursa Malaysia and the Singapore Exchange.
The challenge
According to a recent report by the World Economic Forum, the accelerating impact of climate change is intensifying health risks and placing growing pressure on healthcare systems worldwide. These challenges extend beyond direct health outcomes – climate-related disruptions are affecting supply chains, diminishing operational efficiency and constraining access to essential resources. This underscores the urgent need for sustainable and resilient solutions. The healthcare sector itself is a significant contributor to the problem, accounting for an estimated 4-5% of global greenhouse gas (GHG) emissions, with some countries reporting figures as high as 10% of national emissions.
In response, regulatory momentum is building, with mandatory climate-related disclosures set to take effect in many jurisdictions from 2025 onward. Amongst IHH’s key operating markets of Singapore and Malaysia, Scope 1 and 2 GHG emissions disclosure is required from large, listed companies starting in 2025 and 2027 respectively. As such, sustainability is not only a compliance necessity but also a strategic priority to future‑proof IHH’s operations.
The solution
To set its sustainability agenda in motion, IHH adopted a SG$300m sustainability-linked loan (SLL), tapping on UOB’s sustainability-linked framework. The solution allows IHH to incorporate sustainability targets within its financing strategy, aligning with its broader operational ESG objectives.
Traditionally, ESG financing involves several steps. Firstly, IHH would need to create their own sustainability targets, a process that requires significant effort, resources and time. Subsequently, IHH would have to engage second party opinion (SPO) providers to validate that these sustainability targets are considered ambitious and material, adding further cost and complexity. Finally, only after the targets have been verified by the SPO provider, IHH would then be eligible for SLLs.
By partnering with UOB, IHH was able to accelerate its sustainability journey through a streamlined and practical approach. Leveraging the bank’s established framework, IHH adopted pre-set ESG targets by aligning its existing key performance indicators (KPIs) as sustainability performance targets (SPTs).
This significantly lowered the barriers to entry, eliminating the need to create new metrics or undergo additional verification. As a result, the facility was set up within just two months of initial discussions, with minimal disruption to IHH’s existing processes – demonstrating how strategic collaboration can drive efficient and impactful ESG integration. Beyond financing, UOB provided strategic value to IHH through ESG education. This included a tailored ESG workshop for senior management, equipping them with a deeper understanding of sector-specific sustainability terminology, risks and opportunities. This holistic approach empowered IHH to embed ESG principles more deeply into its strategy and operations, and thereby enhancing their regulatory readiness.
The collaboration between IHH and the bank not only enabled IHH to meet its immediate financing needs but also laid the foundation for long-term ESG integration. This case sets the benchmark for other healthcare providers who are navigating similar challenges.
Best practice and innovation
Innovation is reflected in how IHH Healthcare structured its SG$300m SLL with United Overseas Bank (UOB), referencing metrics from within the FTSE4Good Index framework, an independent and rules‑based ESG assessment published by FTSE Russell. This approach simplifies implementation by using an established external benchmark while maintaining transparency and credibility through UOB’s sustainability‑linked financing framework.
The FTSE4Good methodology draws on globally recognised standards, including the Transition Pathway Initiative (TPI) Management Quality framework for climate change and the UN and ILO conventions for social and human rights indicators. These references provide credibility and alignment with international best practices.
Beyond serving as a reference point for the SLL, this structure helps IHH identify opportunities for continuous improvement, using insights from the index to further enhance its sustainability disclosures and operational performance. The collaboration with UOB demonstrates how innovative financial solutions can link capital to measurable ESG outcomes and reinforce IHH’s long-term commitment to responsible growth.
Key benefits
Cost savings.
Return on investment (ROI).
Improved visibility.
Future-proof solution.
Exceptional implementation (budget/time).
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