Banks are not ultimately responsible for ensuring that a trade finance transaction is sustainable, according to a survey of industry professionals.

Participants ranked financial institutions behind producers, government, manufacturers, traders and end users, meaning that it was the element of the transaction cycle perceived to carry the least responsibility.

More than 100 people were quizzed by Westpac at GTR‘s Asia Trade & Treasury Week in Singapore in September, with just 12% thinking that financial institutions “have the most responsibility in driving sustainable trade”.

This was one of the most surprising takeaways from a survey which confirmed in most part that sustainability is in the thinking of the trade business, even if it is not paramount in its thoughts.

96% of those asked said that sustainability is “an important deciding factor when choosing business partners and service providers”, however just 5% rank sustainable financing as the most important consideration in choosing their trade finance providers.

The most important considerations are still ease of transaction (44%) and pricing (27%), with sustainability also well behind banks’ product offering (18%) and only considered marginally more important than geographical scope.

Sustainability formed a key part of discussions at the event in Singapore, with progress made in the soft commodities sector providing much of the focus.

In 2012, many banks signed up for the Soft Commodities Compact, through which banks help their clients achieve zero net deforestation by 2020. The sustainable shipment letter of credit (SSLC) was launched two years later, whereby the financing of sustainably sourced commodities allowed for discounted financing, in partnership with the IFC.

Westpac’s survey suggests that many in trade finance are using the SSLC (37%) and that a substantial number (48%) are working towards stopping deforestation.

These figures jar, however, with the content of some of the debate at the event itself. Many voiced concerns over the lack of digital options for companies looking to be sustainable: as business moves towards digitisation, it seems a bad time to roll out products that will be legacy within a few years.

Furthermore, the knowledge of these financial products seemed to be the preserve of the banks that offer them: on a panel discussing soft commodity sustainability, one experienced commodity trader had never heard of either the compact or the SSLC, while a senior executive of Cargill considered their application minimal.

Meanwhile, “regulations” are viewed as the biggest challenge to driving sustainable finance. Those polled also thought that “self-regulation” best encourages sustainability. Can self-regulation really drive sustainability?

Wider industry has provided much of the impetus for the sustainability drive in soft commodities, with large buyers such as Nestle, Mars and Unilever simply refusing to buy from producers that fail to adhere to accepted standards.

Anecdotally, however, it has been suggested that strong corporate monitoring can encourage sustainable practice. In June, the Singapore Stock Exchange (SGX) introduced legislation that obliges Singapore-listed companies to publish a sustainability report at least once a year.

“The annual reporting of non-financial information will enhance the visibility of SGX-listed companies among investors who seek sustainable investment,” said SGX chief Loh Boon Chye at the launch.

This, according to a straw poll of Singapore bankers, will force those who weren’t previously concerned about sustainability to wake up to the commercial imperatives. Perhaps the truth is somewhere in the middle: a combination of carrot and stick.

You can read the full findings of Westpac’s survey here.