Awareness of environmental, social, and governance issues among Hong Kong companies is growing, with nearly 90 percent of respondents saying they have raised their concerns over ESG compared with a year ago, as the city pushes for green and sustainable development, according to a survey.
A survey on Hong Kong Industries’ ESG Initiatives and Trends, released by the Hong Kong Brand Development Council and the Chinese Manufacturers’ Association of Hong Kong on Monday, shows that 88.2 percent of surveyed enterprises in Hong Kong have “increased” or “significantly increased” their concerns over ESG compared with the previous year.
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Meanwhile, 75.7 percent of them have increased their investment in ESG.
The findings are based on a study of 144 Hong Kong companies, of which about 20 percent come from the manufacturing industry, 9 percent are construction engineering companies and nearly 70 percent belong to various service industries.
“The surveyed companies are adopting a multifaceted approach in ESG development, which indicates that they are moving forward in each of the three areas of ESG,” said Calvin Chan Ka-wai, chairman of the council.
“This shows a great enthusiasm in the Hong Kong business sector in implementing ESG.”
According to the survey, an average of eight to 10 improvement or enhancement measures are taken by those companies in each of the three areas, with a greater focus on social and governance aspects.
Local firms said they expect to put 41 percent of their future investment into environmental measures, 34 percent into governance measures and 24.5 percent into social measures.
Noting that Hong Kong’s ESG development is still in an early stage, Chan called for greater guidance and support from the authorities.
“Apart from providing fiscal incentives, the Hong Kong Special Administrative Region government should also press ahead with both ESG ‘standard-building’ and ‘capacity-building’,” he said.
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Suggested measures included the appointment of a dedicated department to coordinate ESG development and carry out cross-departmental policy coordination; providing support for organizations to conduct ESG research, training and promotional activities; taking the initiative to establish ESG-related auditing, certification mechanism, and service systems in Hong Kong; offering funding for small and medium-sized enterprises to implement ESG projects through dedicated programs.
ESG investing is taking the world by storm, as global investors pay more attention to the social impact that businesses make instead of focusing purely on their financial performance.
Hong Kong, as an international financial center, is striving to play a leading role in the process by promoting green and sustainable finance. The city had over 200 ESG funds authorized by the Securities and Futures Commission as of the end of last year, with total assets under management hitting $170 billion, according to official statistics. They represent 24 percent and 20 percent year-on-year growth, respectively.
