Hong Kong SAR Government publishes roadmap on sustainability disclosures

On 10 December 2024, the Hong Kong SAR Government published a roadmap on sustainability disclosures in Hong Kong (the Roadmap), which builds on the Vision Statement issued on 25 March 2024 (see our previous blog post). 

The Roadmap sets out Hong Kong’s approach to require “publicly accountable entities”, or “PAEs”, to adopt the International Financial Reporting Standards - Sustainability Disclosure Standards (the ISSB Standards).

Key milestones:

• The Roadmap sets out a pathway for large PAEs to fully adopt the ISSB Standards no later than 2028. 
• The Hong Kong Institute of Certified Public Accountants published the HKFRS Sustainability Disclosure Standards on 12 December 2024 (see our blog post).
• As it stands, all Main Board issuers are required to disclose against the “New Climate Requirements” (which were published by the Hong Kong Exchanges and Clearing Limited (HKEX) in April 2024) based on the IFRS S2 climate-related disclosures on a “comply or explain” basis starting from 1 January 2025. Issuers that are Hang Seng Composite LargeCap Index constituents (Large Cap Issuers) are further required to disclose against the New Climate Requirements on a mandatory basis starting from 1 January 2026 (see our previous briefing).
• The Roadmap states that HKEX will consult the market in 2027 on mandating sustainability reporting based on the HKFRS Sustainability Disclosure Standards for listed PAEs with an expected effective date of 1 January 2028, “under a proportionate approach”.
• The Roadmap states that relevant financial regulators will require financial institutions carrying a significant weight (being non-listed PAEs) to apply the HKFRS Sustainability Disclosure Standards no later than 2028.

[Note: This is a reproduction of a summary table in the Roadmap for developments from 1 January 2025.] 

Other steps to be taken: 

The Roadmap also sets out a plan to develop sustainability assurance, data and technology, as well as skills and competencies to support sustainability disclosures, as follows:

Sustainability assurance

The Roadmap states that the HKICPA will be developing local assurance and ethics standards on a “full convergence basis” with the standards developed by the International Auditing and Assurance Standards Board (IAASB) and the International Ethics Standards Board for Accountants (IESBA) (see our blog post).

The Accounting and Financial Reporting Council (AFRC) is aiming to release a proposed local regulatory framework for sustainability assurance for public consultation in 2025. This framework will address various aspects, including the registration of assurance providers, the implementation of assurance and ethics standards, and the establishment of the related regulatory regime. 

Data and technology 

The Green and Sustainable Finance Cross-Agency Steering Group (the Steering Group) are set to continue to facilitate the quality of data, including through the development of green fintech, rolling out free data tools, and expanding the Hong Kong Taxonomy for Sustainable Finance.

Skills and competencies

The Steering Group and the HKICPA will continue to promote capacity building efforts locally, regionally and internationally. 

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The Roadmap was developed with the support of the Steering Group through a dedicated working group co-led by FSTB and the SFC. Members of the working group included the HKMA, the Insurance Authority, the Mandatory Provident Fund Schemes Authority, the AFRC, HKEX, and the HKICPA.