ESG Consultation Conclusions: Comply or Explain for Environmental and Social KPIs Disclosure
Preparation for Climate Risk Disclsoures, Climate Scenario Analysis, Scope 3 emission Calculation and TCFD
On 14 April 2023, the Stock Exchange of Hong Kong Limited (“the Exchange”) under the Hong Kong Exchanges and Clearing Limited (“HKEX”) published a consultation paper seeking market feedback on proposals to enhance climate-related disclosures under the Environmental, Social and Governance (“ESG”) framework.
The Exchange proposes to mandate all issuers to make climate-related disclosures in their ESG reports, and introduce new climate-related disclosures aligned with the International Sustainability Standards Board (“ISSB”) Climate Standard. With the proposed effective date of 1 January 2024, the interim provisions (shorter or simpler version) of certain disclosures are proposed for the first two reporting years following the effective day.
In view of the level of complication and the level of resources required to fully complied with the proposed disclosures on top of the current ESG Report publication, GreenCo recommends companies to get ready earlier by understanding what are the new requirements and what preliminary work has to be planned and done ahead.
Under the requirements of latest listing rule of HKEx, an issuer must publish its ESG report on an annual basis and regarding the same period covered in its annual report. An ESG report may be presented as information in the issuer’s annual report or in a separate report. Regardless of the format adopted, the ESG report must be published on the Exchange’s website and the issuer’s website.
History
On 18 December 2019, the HKEx published the conclusions to its consultation on the ‘Review of the Environmental, Social and Governance (ESG) Reporting Guide (ESG Guide) and Related Listing Rules’ (ESG Consultation Conclusions), making revisions on the content of existing ‘Listing Rules’ and the ‘ESG Guide’. The amendments will apply to issuers’ ESG reports for financial years commencing on or after 1 July 2020.
The focuses of this revision by the Exchange were mainly on building the corporate ESG framework, mandating the disclosure of the role the Board plays in its engagement in ESG risks management, encouraging the exploration of the links between climate change and corporate sustainable development, and furthering the application of the principle of Materiality in the disclosure of ESG performance and report preparation.
We have years of experience in providing corporate and consultancy services. With the solid practical experience in advising on the latest sustainability trends and developments, we had already provided a range of services on ESG Reporting to Hong Kong and Singapore listed companies, including:
Testimonials and Clients’ Recognition
GreenCo’s team possess good technical knowledge and project management skills. They deliver top quality work well within tight timeframe. They also have great communication with clients.
GreenCo’s team is helpful and always provides prompt responses. They have demonstrated professionalism in sharing valuable insight in ESG development.
We appreciate the competence and professionalism GreenCo’s team demonstrated during the preparation and delivery of the workshop and the analysis.
We assist you to set up corporate sustainability policies and build a robust management system that drives the achievement of sustainable development goals. Our Sustainability Team performs evaluations of your progress in building sustainability, provides advisory support and training, prepares comprehensive and tailor-made sustainability policies that guide your operations, and facilitates your continual improvement to move towards sustainability.
We utilise professional tools and scientific theory to help you set ambitious and appropriate ESG targets. Our expertise in ESG management and sustainability solutions allows us to build specific, measurable, attainable, relevant and time-bounded ESG targets for your company.
We help you engage the stakeholders, conduct materiality assessment, review the sustainability status and conclude their expectation on environmental issues and social development of the enterprise in order to help you make modification accordingly and gain long-term profits.
We provide guidance on ESG-related data collection, identify ways of improvement on data reporting, advise on the development of reporting framework, assist in drafting the content of ESG report in compliance with HKEx ESG Reporting Guide and with reference to the GRI Sustainability Reporting Guidelines to ensure that the expectations of stakeholders are addressed.
We help you calculate carbon emission so that you have a detailed understanding of the yearly carbon footprint of the company and could make offset plan to reduce carbon emission. We also provide independent review services of the carbon emission calculation if the ESG report is performed by your in-house reporting team.
Based on the disclosure of the environment-related issues of the clients including emissions, use of resources and the environmental and natural resources, our professionals will give specific advices on energy conservation and emission reduction accordingly, and help you build a sustainable development system.
By understanding the employment and labour practices, supply chain management and product responsibility of the company, we tailor plans of internal management for you which not only contribute to the optimisation of your management, but also address supply chain and products risks especially related to the environmental and social issues.
We have good connection with institutional investors, thus can help you deal with institutional investors on ESG enquiry if necessary.
Stakeholder Engagement in a Closer Look
Companies need to remain relevant to survive in a challenging business environment and to be relevant requires regular interaction with important stakeholder groups. A robust stakeholder engagement model is vital for companies to be able to understand and respond to legitimate stakeholder concerns. Business leaders and managers will normally be able to list their key stakeholders and concerns, but not furnish the structure and process of engagement as easily.
economic/financial (profitability, cash flow, dividend policy, pricing, growth rate, exchange control); environment (carbon footprint, water, waste management, recycling, compliance) and social (health and safety, skills retention, ethics, transformation, training).
We help you engage the stakeholders, conduct materiality assessment, review the sustainability status and conclude their expectation on environmental issues and social development of the enterprise in order to help you make modification accordingly and gain long-term profits.
Stakeholders Influence on Organization and Organization Impact on Stakeholders Matter!
Misunderstanding of stakeholder engagement
Usually a company takes the stakeholder engagement as part of the activities of public relations or communications. When a company comes to map stakeholders, they focus only to those they know well or to those who speak loudest, not mentioning the difficulties they are facing when transforming the gathered information into business intelligence.
Proper ESG Reporting and Disclosure
We provide guidance on ESG-related data collection, identify ways of improvement on data reporting, advise on the development of reporting framework, assist in drafting the content of ESG report in compliance with HKEx ESG Reporting Guide and with reference to the GRI Sustainability Reporting Guidelines to ensure that the expectations of stakeholders are addressed.
