Building Sustainable Bridges: Navigating the EU ESG Regulations

Ho Chi Minh City, October 23, 2024 – As part of the Green Economy Forum & Exhibition (GEFE 2024) held in Ho Chi Minh City, the panel discussion titled “Building Sustainable Bridges: Navigating the EU ESG Regulations” provided a platform for leading experts and industry representatives to explore the challenges and opportunities posed by European Union (EU) environmental, social, and governance (ESG) regulations.

Moderated by Ms. Truong Hanh Linh, Partner in Risk Management & ESG Consulting Services at KPMG, the session featured a distinguished panel of speakers, including:

• Mr. Nguyen Ba Thong, Aquaculture Program Manager in Vietnam, IDM
• Ms. Hedda Sasburg, Managing Director, ESG Wings
• Dr. Ir. William L Nolten, Business Development Director, Rexil Asia

Taking place at the Dutch Pavilion—the largest national pavilion at GEFE 2024—the discussion spanned 30 minutes, addressing practical implications of ESG standards, including the Corpora

te Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD).

Dr. William L Nolten emphasized the critical need for clarity and understanding of ESG-related directives:

“One of the biggest issues in Vietnam is the misunderstanding of the principles behind ESG, CSRD, and CSDDD. ESG serves as a framework to demonstrate ethical practices, often voluntarily. Mean while, CSRD is a mandatory EU directive, primarily for companies operating within or trading with the EU. CSDDD, on the other hand, transcends EU borders, impacting entire supply chains globally.”

Dr. William L Nolten highlighted that CSDDD is not about enforcing compliance but about understanding and improving sustainability practices:

“CSDDD is not about forcing compliance. It’s about knowing where you stand in terms of sustainability and having a plan for improvement. For small and medium enterprises, this often involves documenting progress and providing accurate information without exaggeration.”

He praised the Dutch Business Association Vietnam (DBAV) for its mentorship and programs that help businesses navigate these regulations effectively, enabling faster adoption and alignment with EU standards.

Business Recommendations for Vietnam

Responding to a question about Vietnam’s role in enhancing CSRD reporting and trade activities, Dr. Nolten shared actionable insights:

1. Leverage Dutch Expertise:

He noted that Dutch support, through initiatives like the DBAV’s “Ready to Export” program, has been instrumental in helping businesses adopt sustainable practices efficiently.

“Vietnam doesn’t need to repeat the mistakes Europe made in its sustainability journey. By learning from Dutch and European expertise, Vietnamese businesses can accelerate their compliance and competitiveness.”

2. Promote Carbon-Low Farming:

Dr. William L Nolten stressed the importance of transitioning to low-carbon farming practices and utilizing bioplastics derived from microalgae, which address food security concerns and match the cost of conventional plastics.

“The integration of bioplastics and other sustainable innovations ensures that Vietnam’s agricultural sector is both eco-friendly and profitable.”

3. Focus on Collaboration, Not Competition:

He urged the sustainable industry to focus on competing with unsustainable markets rather than among themselves, leveraging Vietnam’s potential to capture market share from the 90% of markets that are not yet sustainable.

The Role of NGOs and Community Engagement

Dr. William L Nolten also recognized the crucial role of non-governmental organizations (NGOs) like Akitara and ASSIST in ensuring transparency and accountability:

“NGOs act as independent auditors, verifying our claims and impacts. Their presence ensures trust and credibility, both locally and internationally.

A Shared Vision for Sustainability

Dr. William L Nolten concluded with optimism for Vietnam’s sustainability journey:

“With the support of the Dutch government, DBAV, and collaborative efforts from businesses, Vietnam is well-positioned to lead in sustainable practices, benefiting farmers, small-medium enterprises, and global trade partnerships alike. Together, we can achieve a greener future with tangible benefits for all stakeholders.”

This impactful panel discussion, hosted at GEFE 2024, underscored the importance of fostering understanding, collaboration, and innovation to meet EU ESG standards and build sustainable bridges in the global market.