Hong Kong
Answer ... Listed companies: The ESG Reporting Guide of the Listing Rules has mandatory disclosure requirements requiring a public company to disclose:
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its ESG governance structure; and
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the reporting principles and boundaries of its ESG report.
Further, the company must follow ‘comply or explain’ provisions that cover disclosures and key performance indicators across 12 environmental and social issues. Also part of the Listing Rules, the Corporate Governance Code of the Listing Rules requires further disclosure in relation to a company’s governance in general and specifically in relation to diversity policies.
Fund managers: Under the Securities & Futures Commission’s (SFC) Climate Requirements (see question 1.2), fund managers must:
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identify, assess and take into account climate-related risks in their investment management and risk management procedures;
- set up a governance structure to oversee the incorporation of climate-related considerations; and
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make appropriate disclosures to investors (‘baseline requirements’).
Fund managers that had assets under management of at least HK$8 billion in any three months in the previous reporting year (‘large fund managers’) must further adhere to the enhanced standards to:
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assess and implement scenario analysis;
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identify portfolio carbon footprints associated with the underlying investments; and
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disclose their engagement policy and portfolio carbon footprints.
These criteria are expected to take effect:
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with respect to large fund managers, from 20 August 2022 for the baseline requirements and 20 November 2022 for the enhanced standards; and
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for other fund managers, from 20 November 2022 for the baseline requirements.
Retail funds: Based on the SFC ESG Funds Requirements (see question 1.2), SFC-authorised unit trusts and mutual funds that identify themselves as ESG funds must, among other things, disclose in their offering documents:
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the ESG focus of the fund;
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the ESG investment strategy;
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asset allocation;
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reference benchmark;
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reference to additional information; and
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ESG-related risks.
ESG funds must also make periodic assessment and conduct ongoing monitoring of underlying investments on their ESG focus.
Mandatory provident funds: Under the Mandatory Provident Funds Scheme Authority’s (MPFA) Principles for Adopting Sustainable Investing in the Investment and Risk Management Processes of MPF Funds, such funds must focus on the four key elements of:
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governance;
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strategy;
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risk management; and
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disclosure.
The principles are largely similar to the Fund Management Code of Conduct (FMCC) requirements for fund managers, which adhere to the Task Force on Climate-related Financial Disclosures framework.
Hong Kong
Answer ... Please see question 9.1.
Hong Kong
Answer ... The principal ESG issues in Hong Kong are the 12 aspects listed under the ESG Reporting Guide, as follows:
Environmental |
Social |
A1. Emissions |
B1. Employment |
A2. Use of resources |
B2. Health and safety |
A3. Environment and natural resources |
B3. Development and training |
A4. Climate change |
B4. Labour standards |
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B5. Supply chain management |
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B6. Anti-corruption |
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B7. Community investment |