普华永道：香港上市公司环境、社会及治理报告调研2021（英文）_49页_7mb

Summary of ESG Reporting Study for Hong Kong Listed Companies (2021)

Core Content

This study, conducted by PwC Mainland China and Hong Kong, provides an analysis of ESG reporting practices among Hong Kong listed companies in 2020. It evaluates the compliance with the ESG Reporting Guide (2019 Version) issued by HKEX, highlights the current status of ESG disclosure, and identifies areas for improvement. The report also discusses the adoption of international standards and the role of third-party assurance in enhancing the credibility of ESG disclosures.

Main Points

1. Background and Methodology

• Background: In December 2019, HKEX introduced new "mandatory disclosure" requirements in the ESG Reporting Guide (2019 Version), including "comply or explain" provisions for social KPIs.
• Methodology: PwC analyzed 268 Hong Kong listed companies that released ESG reports before 10 July 2021, categorizing them into 12 primary industries based on the Hang Seng Industry Classification System. The study focused on reporting structure, content integration, and alignment with international standards.

2. Overall Disclosure Status

• Awareness and Quality: Hong Kong listed companies are increasingly aware of the importance of ESG, with a significant improvement in the quality of ESG reports.
• Format Trends:
  • $68%$ of sampled companies used stand-alone ESG reports.
  • $16%$ of reports were under 20 pages, with the consumer discretionary sector leading.
  • $16%$ of reports exceeded 100 pages, primarily from the property and construction industry.
• Materiality: Nearly $2/3$ of companies determined ESG materiality based on their own features.
• Standards:
  • $34%$ of reports referred to other standards, with $90%$ using GRI standards.
  • $9%$ and $6%$ of reports incorporated the TCFD framework and SASB standards respectively.
  • Top adopters of other standards were utilities ($80%$), energy ($80%$), and financial services ($68%$).
• Assurance:
  • $16%$ of reports were assured by third parties, with the banking sector having the highest assurance rate at over $50%$.
  • $55%$ of assured reports focused on KPIs, while others covered the entire report.
• SDGs:
  • $30%$ of sampled companies responded to UN SDGs in their ESG reports.
  • $30%$ identified key SDGs and set targets and KPIs.
  • Companies are integrating SDGs into ESG strategies and forming a long-term transformation mechanism.

3. 2020 ESG Requirements for HKEX Listed Companies

• Governance Structure:
  • $70%$ of companies disclosed board oversight on ESG matters.
  • Only $15%$ disclosed board monitoring of ESG targets.
  • Utilities led in board monitoring of ESG targets ($60%$), followed by conglomerates and energy ($40%$), with healthcare being the lowest ($0%$).
• ESG Committees:
  • $30%$ of companies formed an independent ESG committee.
• Reporting Principles:
  • $94%$ of ESG reports disclosed the reporting boundary.
  • $64%$ disclosed the process of determining the reporting boundary.
  • $90%$ of companies disclosed policies related to emissions and resource use, but data disclosure needs improvement.
• Materiality:
  • $40%$ of companies did not disclose the materiality assessment process.
  • Companies should focus on material ESG issues and ensure data consistency and comparability.

4. Key ESG Aspects

A1: Emissions

• Policies: $90%$ of sampled companies disclosed policies on air and greenhouse gas emissions, discharges, and waste.
• KPIs:
  • $98%$ disclosed greenhouse gas data (A1.2), with $63.06%$ disclosing Scope 1 and Scope 2 data.
  • $22.39%$ disclosed Scope 3 data.
  • $88%$ and $89%$ disclosed hazardous and non-hazardous waste data respectively, but only $47.39%$ and $56.72%$ disclosed intensity data.
• Challenges:
  • Limited intensity disclosure.
  • Companies need to explain non-disclosure in line with the "comply or explain" principle.

A2: Use of Resources

• Policies: $71%$ of companies disclosed policies on resource use.
• KPIs:
  • $95%$ and $97%$ disclosed energy and water consumption data respectively.
  • $80.6%$ disclosed intensity data for both energy and water.
  • $84%$ disclosed packaging material data, with a $7%$ increase compared to the previous year.
  • $48%$ of companies selected "not applicable" and provided explanations.
• Challenges:
  • Intensity disclosure remains a challenge.
  • Companies should continue to adopt energy-saving technologies and clean energy.

A3: Environment and Natural Resources

• Policies: $65%$ of companies disclosed policies related to minimizing environmental and natural resource impacts.
• KPIs:
  • $85%$ disclosed A3.1 data, but $15%$ did not disclose or explain.
• Challenges:
  • Limited understanding of environmental impacts.
  • Companies often focus on current emissions and energy-saving measures rather than comprehensive responses.

Key Recommendations

• Governance:
  • Establish an ESG governance structure aligned with the company's business and risks.
  • Form an independent ESG committee to oversee ESG strategy and implementation.
• Reporting:
  • Apply materiality assessment to identify key ESG issues and ensure targeted disclosure.
  • Follow reporting principles to ensure data consistency and comparability.
• Standards:
  • Adopt international standards like GRI, TCFD, and SASB to enhance reporting quality.
• Assurance:
  • Seek third-party assurance to increase the credibility of ESG information.
  • Focus on KPIs in assurance scope to improve ESG ratings.
• SDGs:
  • Integrate UN SDGs into ESG strategies and operations.
  • Set measurable targets aligned with SDGs to demonstrate commitment.

Outlook

• Future ESG reporting will likely see stricter requirements for data availability and quality.
• Companies should prepare for enhanced regulatory developments related to climate change and ESG.
• Continuous improvement in ESG management and reporting is essential for long-term sustainability and stakeholder trust.