The HKGFA Workshop on How to Understand and Prepare Climate-related Disclosures was successfully held on 25 September 2020, with close to 200 audiences joining from asset management companies, ESG investors, and financial institutions. The workshop was organized by the Hong Kong Green Finance Association (HKGFA) and supported by the Hong Kong Exchanges and Clearing Limited (HKEX).

Watch the Full Workshop Video

Read the Presentation Materials

25 September 2020

For the full agenda of the workshop, please visit the HKGFA event website

Key takeaways from the workshop

• With President Xi’s pledge for China to achieve carbon neutrality before 2060, it marks an accelerated push on the climate agenda and the urgency for companies to integrate ESG disclosure into their business structure. It is a collaborative effort that all industries need to work on to build a comprehensive ESG ecosystem

• Data availability, the board’s willingness to address climate-related issues, and materiality assessments are significant challenges that asset managers or investors may face when making informed decisions on investments. Issuers need to realize that ESG reporting is no longer a compliance exercise, nor an add-on value or satisfying Corporate Social Responsibility, but a necessary tool and process for long-term risk management and mitigation practice.

• In addressing the difficulties that issuers may face in ESG disclosure and reporting, HKEX has made a tailored guide, “Leadership role and accountability in ESG” to support and improve the board’s leadership role and accountability in ESG and the governance structure for ESG matters; and the Step-by-step ESG Reporting Guidance titled “How to prepare an ESG report”.

Joy Song, Co-Chair of ESG Disclosure and Integration Working Group, Hong Kong Green Finance Association encouraged the audience to take action, “It’s exactly the right timing to bringing more capacity buildings on climate-related issues to our society. I feel very promising seeing our panelists sharing their experience in proactive corporate engagement and strategic partnership with investee companies along their sustainable management path. Together with further policy signals of decarbonization as well as strengthening financial regulations on ESG and climate-related issues, we will be seeing more corporates pursuing low-carbon transitions not only for compliance, but for creating long-term values.”

Kelly Lee, Vice President, Policy and Secretariat Services Unit, Listing Division, Hong Kong Exchanges and Clearing Limited shared the future actions of HKEX,” The board plays a crucial role in embedding ESG considerations in the business strategy, making the company more agile and better prepared to deal with changes. The Exchange will continue our efforts in developing a culture in which ESG practices and reporting are fully integrated into daily business operations, leading to greater transparency, more resilient risk management process and sustainable value creation.”

Katherine Han, Head of ESG Research, Harvest Fund Management shared, “Climate change is a core issue assessed in our proprietary ESG framework, which is integrated into our investment process to make better-informed investment decisions. We look at carrying out progressive and strategic engagement programs with key investee companies where we carry them through the long journey. This partnership journey would start from fostering awareness and disclosure, and advance to work with companies to systematically improve climate governance and adapt business models. This is beneficial for us as this could unlock long term corporate value and improve the quality of investment returns for us.”

Gabriel Wilson-Otto, Head of Stewardship Asia Pacific, BNP Paribas Asset Management stated from an investors’ perspective, “As investors, we seek to understand a company’s strategic engagement with climate-related risks and opportunities. We aim to look beyond the data to understand board-level engagement and the governance processes behind materiality assessment and data disclosure.”

Iancu Daramus, Senior Sustainability Analyst, Investment Stewardship Team, Legal & General Investment Management suggested, “Capital is increasingly flowing towards companies aligned with the low-carbon transition, and fleeing from misaligned ones. Setting ambitious sustainability strategies and targets, working with suppliers and consumers to turn them into reality, and communicating it all in transparent reporting will be key elements for companies’ long-term success.”

Mary Leung, Head of Advocacy, Asia Pacific, CFA Institute motivated the audience to better equip for climate-related risks, “In order for capital to be allocated efficiently and effectively, investors and other capital providers need access to timely, relevant, consistent disclosures from companies.  The analysis has increasingly broadened to include the impact of climate change.  Financial professionals need to be equipped with the best tools and training around climate change analysis in order to make investment decisions that take climate change into consideration.  Further, asset managers should engage with issuers to ensure that climate data, scenario analysis, and related disclosures are sufficiently thorough to support robust climate risk analysis in the investment process.”

Flora Yu, Manager, Sustainability Dept, CECEP Environmental Consulting Group Limited, and Junfeng Zhao, Assistant Vice President, Green Finance Dept, CECEP Environmental Consulting Group Limited, “Climate change is closer and severer to our daily life far more than we imagine. The only way is to identify issues, manage risk, and take opportunities. While target setting is a commitment towards a sustainable economy and climate change mitigation, corporates could set targets with a top-down carbon budget allocation approach and/or bottom-up feasibility assessment approach. CECEPEC continues supporting businesses to address climate change-related risk and opportunity, and to set science-based targets to fulfill long-term success of business strategies.”

Joseph Gualtieri, Corporate Engagement, CDP Hong Kong, and Pratima Divgi, Regional Director, CDP Hong Kong remarked, “As world’s largest climate and environmental disclosure platform for corporates, CDP aims to standardize disclosure under the TCFD framework. CDP’s presentation introduces TCFD and maps HKEx’s ESG requirements on to the TCFD guidelines. Using insights and analysis from over 2,500 corporate responses in the Asia Pacific, CDP demonstrates how companies can use the TCFD framework to go beyond compliance requirements and provide the capital markets with relevant, decision-useful environmental data.”