Hong Kong has recently introduced a comprehensive roadmap to enhance sustainability disclosure among companies and regulated financial institutions.
According to ESG Today, the new directives, set to kick in by 2025, align with the International Financial Reporting Standards (IFRS) Foundation’s International Sustainability Standards Board (ISSB), marking a significant move towards global standards.
The government’s initiative follows its earlier “vision statement on developing a sustainability disclosure ecosystem,” which underscores its commitment to aligning local practices with international benchmarks. The Hong Kong Institute of Certified Public Accountants (HKICPA) has been pivotal in this alignment, releasing exposure drafts that echo the ISSB’s sustainability-related and climate-related reporting standards.
Under the newly unveiled roadmap, all Main Board issuers in Hong Kong are mandated to begin reporting based on the IFRS S2 Climate-related Disclosures on a “comply or explain” basis starting in 2025. This requirement will extend to large-cap issuers on a mandatory basis from 2026. By 2028, significant financial institutions will also be obligated to adhere to these standards, with the Hong Kong Stock Exchange (HKEX) consulting on mandating broader sustainability reporting.
Moreover, Hong Kong is poised to develop a regulatory framework for sustainability assurance and promote green FinTech innovations. Initiatives like free data tools and the expansion of the Hong Kong Taxonomy for Sustainable Finance are also on the horizon, further cementing the city’s role as a leader in green and sustainable finance.
Hong Kong’s Secretary for Financial Services and the Treasury, Christopher Hui, highlighted the city’s strategic efforts in an international context, saying, “As a premier international financial centre as well as a green and sustainable finance hub, Hong Kong is taking consistent steps to consolidate its competitiveness through observing international standards and best practices. The launch of this roadmap on the full adoption of the ISSB Standards clearly highlights our commitment to continuing to play a leading role in facilitating green and sustainable financing and investment for the global agenda of green transition.”
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