The Hong Kong Government has launched a comprehensive roadmap for sustainability disclosure, setting out plans to require publicly accountable entities (PAEs) to adopt the International Financial Reporting Standards – Sustainability Disclosure Standards (ISSB Standards). This initiative outlines a clear path for large PAEs to fully align with the ISSB Standards no later than 2028, reinforcing Hong Kong’s role as a leading green finance hub.
Speaking at the launch, the Secretary for Financial Services and the Treasury, Christopher Hui, emphasised Hong Kong’s commitment to upholding international standards. “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. This roadmap provides a transparent and well-defined pathway on sustainability reporting for PAEs in Hong Kong. The Financial Services and the Treasury Bureau (FSTB) in collaboration with financial regulators and stakeholders will continue to support the pragmatic implementation of the Hong Kong Sustainability Disclosure Standards (Hong Kong Standards) through enhancing capacity building and promoting the use of technological solutions,” he said.
The Hong Kong Institute of Certified Public Accountants (HKICPA) is finalising the Hong Kong Standards, aligned with the ISSB Standards. Following a public consultation showing broad support, the final standards are expected by year-end, effective from 1 August 2024.
Starting 1 January 2024, all Main Board issuers must comply with new climate-related disclosure requirements based on IFRS S2 Climate-related Disclosures on a “comply or explain” basis.
Large-cap issuers listed under the Hang Seng Composite LargeCap Index will transition to mandatory compliance with these requirements from 1 January 2026. By 2027, the Hong Kong Exchanges and Clearing Limited (HKEX) will consult stakeholders on mandating sustainability reporting for listed PAEs, with an expected start date of 1 January 2028.
Financial regulators will require significant non-listed PAEs to adopt the Hong Kong Standards by 2028. The roadmap also highlights a blueprint for fostering a robust ecosystem to support sustainability disclosures, focusing on assurance, data, technology, and skill development. The Accounting and Financial Reporting Council (AFRC) will lead efforts to establish a high-quality regulatory regime for sustainability assurance, aligned with international standards.
The Green and Sustainable Finance Cross-Agency Steering Group will promote green fintech, expand free data tools, and enhance the Hong Kong Taxonomy for Sustainable Finance. Collaborative initiatives between the Steering Group, HKICPA, and other stakeholders will focus on capacity building at local, regional, and international levels.
The roadmap was crafted with input from a dedicated working group co-led by the Financial Services and the Treasury Bureau (FSTB) and the Securities and Futures Commission. Contributors include the Hong Kong Monetary Authority, the Insurance Authority, the Mandatory Provident Fund Schemes Authority, the AFRC, the HKEX, and the HKICPA.
With this roadmap, Hong Kong positions itself to remain at the forefront of sustainable finance, advancing global efforts toward a greener future.
