Jurisdiction - Hong Kong
Reports and Analysis
Hong Kong – Consultation Conclusions On ESG Reporting.

15 October, 2012


In August 2012, the Exchange published the consultation conclusions on the proposed Environmental, Social and Governance (ESG) Reporting Guide. 
 
Here are the highlights:  
 
What is it? 
 
The proposed Guide sets out ESG subject areas, aspects, general disclosure and key performance indicators (KPIs). The Guide will be a recommended practice and will be appended as a new Appendix 27 to the Listing Rules. 
 
The Guide is divided into four areas: Workplace Quality, Environmental Protection, Operating Practices and Community Involvement. Each of the areas is divided into three sections: aspects, general disclosure recommendations and KPIs. 
 
The Exchange does not expect a company to report on all recommended disclosures from the start. A company with resource constraints could start reporting on a few KPIs and cover only its major operations/subsidiaries. The key is to report on relevant and material KPIs that are material to the company. 
 
When will it apply?
 
The Guide will apply to companies in financial years ending after 31 December 2012.
 
Who is responsible for ESG reporting? 
 
The board of directors is responsible for ESG reporting but it may delegate the task of compiling the ESG report to its employees or a committee that reports to the board.
 
Where should the ESG information be disclosed? 
 
A company may disclose the ESG information in its annual report regarding the same period covered in the annual report, or in a separate report, in print or on its website.
 
Timeframe for raising level of obligation to “comply or explain” 
 
Subject to further consultation, the Exchange plans to raise the level of obligation of some recommended disclosures to “comply or explain” by 2015. To prepare for the consultation, the Exchange will conduct its first survey of companies’ financial reports to be published in 2014.   
 
For a copy of the consultation conclusions, please follow the link: 

 

 








For further information, please contact:
 
Tony Grundy, Partner, Morrison Foerster
 
John Moore, Partner,  Morrison Foerster

 

 

 

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