Hong Kong Inter-agency Steering Group Latest Announced!

On 7 August, the Green and Sustainable Finance Cross-Agency Steering Group (the Steering Group), co-led by the Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC), announced key areas of work to further promote and strengthen Hong Kong's role as a leading sustainable finance hub.

According to the HKSAR Government's website, the Steering Group was established in May 2020 and is jointly led by the Hong Kong Monetary Authority and the SFC, with members including the Environment and Ecology Bureau, the Financial Services and the Treasury Bureau (FSTB), Hong Kong Exchanges and Clearing Limited (HKEX), the Insurance Authority and the Mandatory Provident Fund Schemes Authority.

Three key areas of work

According to the announcement, the key areas of work of the Steering Group include the following three points:

First, align with global standards and establish a world-class regulatory regime. It will develop a comprehensive roadmap for Hong Kong with the aim of appropriate adoption of IFRS sustainability disclosure standards, taking into account Hong Kong's position in global green finance and local regulatory expectations and circumstances; A working group comprising relevant authorities and stakeholders will be set up to consider the elements that should be included in the road map and make recommendations to the Steering Group.

Second, to enhance Hong Kong's vitality and competitiveness through skills training, data enhancement and technological innovation in the financial ecosystem to drive the net-zero transformation of the economy. The Sub-group will organise workshops to support unlisted companies and SMEs in sustainable planning and reporting, and make wider use of existing data resources and tools. It will also develop a data platform to enrich climate-related data resources and improve usability through data collected from climate and environmental risk questionnaires of private companies and small and medium-sized enterprises; It will also explore opportunities for public-private collaboration to promote technology solutions development, and will work with relevant stakeholders to develop a green fintech blueprint for Hong Kong.

Third, develop a dynamic and reliable market and diversified products to lead the transition to net zero capital flows. The relevant bodies of the Steering Group have integrated transition considerations into broader policy development and support sustainable finance. The Steering Group will explore further ways to support financial institutions and enterprises in their transformation planning and reporting. At the same time, the Sub-group will continue to work to develop Hong Kong into an international carbon market, connecting opportunities in the Mainland, Asia and the rest of the world.

Eddie Yue, Co-Chairman of the Steering Group and Chief Executive of the Hong Kong Monetary Authority, said: "Transitioning to a net-zero future will require concerted efforts and significant investment from all sectors. Based on close cross-agency collaboration under the Steering Group, we are actively integrating transformation considerations into current development and regulatory work, taking into account the latest international developments in transformation planning, providing clear guidance on disclosure, enriching data resources, and promoting the use of innovation and technology to promote the development of financial solutions. We want to contribute to the gradual transformation of the region towards a greener and more sustainable future. ”

Leong Feng-yee, Co-Chairperson of the Steering Group and Chief Executive Officer of the Securities and Futures Commission, said, "The climate transition brings huge business opportunities and investment opportunities. To help Hong Kong capture these opportunities in Asia, the Steering Group will continue to strengthen important measures that can promote Hong Kong's development, including implementing a clear and robust regulatory framework on sustainability disclosure, providing diversified financial products, and supporting skills training for the industry. Technology is an integral part of market efficiency and transparency, and one of the Steering Group's priorities is to work with relevant stakeholders to promote Hong Kong as a green fintech hub. ”

The Steering Group puts sustainability at the heart of its work

According to public information, the Steering Group is committed to coordinating the financial industry's response to climate and environmental risks in various ways, accelerating the development of green and sustainable finance in Hong Kong, and supporting the government's climate strategy.

The main modalities include exploring policy and regulatory issues on green and sustainable finance, particularly those that may have cross-sectoral impacts; Coordinate policy direction to ensure that Hong Kong has a well-thought-out green and sustainable finance strategy; Handling cross-industry technical issues by forming technical teams and consulting experts and stakeholders; To grasp international and regional trends, issues and developments in green and sustainable finance, and to study how Hong Kong can better position itself and play a leading role in the region and globally; and to examine how Hong Kong can enhance its strengths in green and sustainable finance and enhance its thinking leadership in the regional and international arena.

Since its establishment, the Steering Group has undertaken a series of tasks to further promote and consolidate Hong Kong's role as a leading sustainable finance hub.

On 20 December last year, the Steering Group announced its collaboration with CDP (Carbon Disclosure Project) in the fields of data and sustainability reporting to jointly enrich Hong Kong's climate data resources and strengthen sustainable development reporting. In addition, as part of this collaboration, the Steering Group and CDP developed a climate and environmental risk questionnaire (SME Questionnaire) for unlisted companies/SMEs. This is the first cross-industry questionnaire sample tailored for Hong Kong enterprises, especially SMEs, that have never made a relevant report.

On 13 December last year, the Steering Group announced the launch of the three-year Green and Sustainable Finance Training Pilot Scheme to encourage local qualified practitioners and those aspiring to engage in green and sustainable finance related training to address the new trend of low-carbon and sustainable economic development.