HKEx Publishes Consultation Conclusions on Enhancing Climate-Related Disclosure
On 19 April 2024, HKEx released conclusions on enhancing climate-related disclosures under its ESG framework, aiming to improve transparency and align with global sustainability standards.
HKEx Publishes Consultation Conclusions on Enhancing Climate-Related Disclosure
On 19 April 2024, the Stock Exchange of Hong Kong Limited (HKEx) published the conclusions to its consultation on enhancing climate-related disclosures under the exchange’s environmental, social and governance (ESG) framework. This initiative reflects HKEx’s commitment to promoting sustainable finance and aligning Hong Kong’s capital markets with international best practices.
Key Highlights of the Consultation Conclusions
- Enhanced Disclosure Requirements: Listed companies will be required to provide more detailed and consistent climate-related information, including governance, strategy, risk management, and metrics and targets.
- Alignment with Global Standards: The updated framework aligns with recommendations from the Task Force on Climate-related Financial Disclosures (TCFD) and other international sustainability reporting standards.
- Phased Implementation: The new disclosure requirements will be implemented in phases, allowing companies sufficient time to adapt and enhance their reporting capabilities.
- Focus on Transparency and Comparability: The enhancements aim to improve the quality, comparability, and reliability of climate-related disclosures to better inform investors and stakeholders.
Implications for Listed Companies and Investors
Listed companies in Hong Kong will need to review and potentially upgrade their ESG reporting processes to meet the new climate disclosure requirements. This may involve strengthening internal controls, data collection, and governance structures related to climate risks and opportunities.
Investors will benefit from improved transparency and more comparable data, enabling better assessment of climate-related risks and alignment with sustainable investment strategies.
Next Steps
HKEx will continue to engage with market participants and stakeholders to support the implementation of the enhanced disclosure framework. Companies are encouraged to begin preparing for the changes by assessing their current ESG disclosures and identifying areas for improvement.