香港上市公司气候披露的新时代 New Era of Climate Disclosure for Hong Kong Listed Companies

NewEraofClimateDisclosureforHongKongListedCompanies

25April2024

NewEraofClimateDisclosureforHongKongListedCompanies

April,2024

EXECUTIVESUMMARY

•On19April2024,theHongKongStockExchange(“HKEX”)releasedthe

Consultation

Conclusions

onEnhancementofClimate-relatedDisclosuresundertheEnvironmental,SocialandGovernanceFramework(followingonfromaConsultationPaperissuedin

April2023)layingoutnewrequirementsinrespectofclimate-relateddisclosures(“NewClimateRequirements”)

•TherequirementsarealignedwithIFRSS2Climate-relatedDisclosures(“IFRSS2”)tothemaximumextentpossible

•TheHKEXhasputinplaceaphasedapproachtoimplementationofthenew

requirementsbasedontiersofissuers(largecapissuers,mainboardissuersotherthanlargecapissuersandGEMissuers)(“PhasedApproach”)

•Anumberofdifferentimplementationreliefshavebeenputinplaceinordertoeasethedifficultiesofcomplianceforissuers

•HKEXissuersnowhavefinalclarityontheNewClimateRequirementsandwillbeabletofocuseffortsonpracticalstepsneededtodealwiththechallengeofbeingreadytomeetthenewreportingrequirements

Introduction&background

On14April2023,theHKEXpublishedaConsultationPaperseekingviewsonproposalstoamenditsESGreportingframework,whichispredominantlysetoutinAppendixC2totheMainBoardListingRulesandGEMListingRules,tomandatethatlistedissuersmakeclimate-relateddisclosuresbasedonthethenproposedIFRSS2intheirESGreports.Sincethatdate:

•theInternationalSustainabilityStandardsBoard(“ISSB”)finaliseditsproposalswiththeissuanceinJune2023ofIFRSS1GeneralRequirementsforDisclosureofSustainability-relatedFinancialInformation(“IFRSS1”)andIFRSS2aimingtoserveastheglobalbaselineofsustainabilityreportingstandardsforentitiesworldwidetoprepareconsistent,comparableandreliablesustainabilitydisclosures.

•InJuly2023,theInternationalOrganizationofSecuritiesCommissionsendorsedtheIFRSSustainabilityDisclosureStandards(“IFRSSDS”)andcalledonitsmemberjurisdictionstoconsiderwaysinwhichtheymightadopt,applyorotherwisebeinformedbytheIFRSSDSwithinthecontextoftheirjurisdictionalarrangements.

•InFebruary2024,theIFRSFoundationpublishedtheISSBAdoptionGuidePreview,whichsuggestsafocusonpubliclyaccountableentitiesandallowsjurisdictionalregulatorstoclassifytheseentitiesintodifferentmarkettierswith

referencetothresholdssuchasanissuer’ssize,volumeoftradedsecuritiesorliquidity,andconsideranacceleratedintroductionoftherequirementsoftheIFRSSDSforthemoreadvancedmarkettiers.

•InMarch2024,theHongKongGovernment’sFinancialServicesandtheTreasuryBureau(“FSTB”)publishedastatement(

“VisionStatement”

)settingoutthevisionandapproachoftheGovernmentandfinancialregulatorstowardsdevelopingacomprehensiveecosystemforsustainabilitydisclosureinHongKong.Inparticular,theHongKongInstituteofCertifiedPublicAccountants(“HKICPA”)willassumetheroleofthesustainabilityreportingstandardsetterinHongKongto

developlocalsustainabilityreportingstandardsalignedwiththeIFRSSDSaswellascomplementaryapplicationandimplementationguidance.

•On12April2024,undertheauspicesoftheChinaSecuritiesRegulatoryCommission(“CSRC”),theShanghaiStockExchange,theShenzhenStockExchangeandtheBeijingStockExchangeissuedtheguidelinesforthesustainabilityreportingoflistedcompanies

TakingaccountofthesedevelopmentsandrespondingtofeedbackofconstituentstotheConsultationPaper(whichcontainedstrongsupportfortheproposalsthoughwithanumberofconstituentscallingforcloseralignmentwiththefinalIFRSSDS),theHKEXpublishedon19April2024theConsultationConclusionswhichadoptalltheproposalsintheConsultationwithcertain

modificationstoreflecttherequirementsofIFRSS2tothemaximumextentpossible.Inaddition,concurrentlywiththe

publicationoftheConsultationConclusions,theHKEXalsopublishedanImplementationGuidancewhich,amongotherthings,containstheconceptualfoundationsandgeneralrequirementsofIFRSS1(seelatersection“ImplementationGuidanceand

IFRSS1”fordetails).

CoreContentoftheclimate-relateddisclosures

TheexistingrequirementsofPartsBandCoftheESGCode(formerlyESGGuide)havebeenlargelyretained(withexceptionoftherequirementsonScope1and2greenhousegas(“GHG”)emissionbeingmovedtoPartD).AnewPartDoftheESGCodeofAppendixC2oftheMainBoardListingRulesandGEMListingRules(howeverforfurtherdetailsseesectionbelow“EffectivedateandthePhasedApproach”)setsoutthedetailednewdisclosurerequirementsacrossthefourcorepillarsusedintheIFRSSDS:governance;strategy;riskmanagement;andmetricsandtargets.Somekeyareasofdisclosureaspertherequirements

arelistedinthebelowtable:

Governance

•Informationabouttheissuersbody(s)orindividual(s)responsibleforoversightofclimate-relatedrisksandopportunitiesincluding:

•howthebody/individualdetermineswhetherappropriateskillsandcompetenciesareavailable,

•processandfrequencyofbeinginformedonclimate-relatedrisksandopportunities,

•considerationofclimate-relatedissueswhenoverseeingstrategy,decisionsonmajortransactionsandriskmanagementandrelatedprocesses(includingconsiderationoftrade-offs),

•monitoringofprogresstowardstargetsrelatedtoclimate-relatedrisksandopportunitiesandlinkageofrelatedperformancemetricswithremunerationpolicies

•Management’sroleinthegovernanceprocesses,controlsandproceduresusedtomonitor,manageandoverseeclimate-relatedrisksandopportunities,including:

•whethertheroleisdelegatedtospecificmanagementlevelposition/committeeandhowoversightisexercised

•whethermanagementusescontrolsandprocedurestosupporttheoversightofclimate-relatedrisksandopportunitiesandwhethertheseareintegratedintootherinternalfunctions

Strategy

•Informationregardingclimate-relatedrisksandopportunitiesthatcouldreasonablybeexpectedtoaffecttheissuer’scashflows,itsaccesstofinanceorcostofcapitalovertheshort,mediumorlongterm1

•Informationregardingcurrentandanticipatedeffectsofclimate-relatedrisksandopportunitiesonbusinessmodelandvaluechain

•Informationregardingtheeffectsofclimate-relatedrisksandopportunitiesonitsstrategyanddecision-making

includinghowtheissuerhasrespondedto,andplanstorespondto,climate-relatedrisksandopportunitiesinits

strategyanddecision-making,informationaboutitscurrentandanticipatedadaptationandmitigationefforts,howitplanstoachieveanyclimate-relatedtargets,anyclimate-relatedtransitionplanaswellasprogressofsuchplans

disclosedinpreviousreportingperiods

•Qualitativeandquantitativeinformationabouthowclimate-relatedrisksandopportunitieshaveaffectedanissuer’s

financialposition,financialperformanceandcashflowsforthereportingperiodandwhereinrespectofsuchrisksandopportunitiesthereisasignificantriskofamaterialadjustmentwithinthenextannualreportingperiodtothecarryingamountsofassetsandliabilities

•Qualitativeandquantitativeinformationabouthowtheissuerexpectsitsfinancialposition,financialperformanceandcashflowstochangeovertheshort,mediumandlongterm,givenitsstrategytomanageclimate-relatedrisksand

opportunities1

•Issuersassessmentofclimateresilienceincludingscenarioanalysis1toshowresilienceoftheissuer'sstrategyand

businessmodeltochanges,developmentsanduncertaintiestakingintoconsiderationtheissuer’sidentifiedclimate-relatedrisksandopportunities

RiskManagement

•Issuer’sprocessandrelatedpoliciesusedtoidentify,assess,prioritiseandmonitorclimate-relatedrisksand

opportunities,includingwhetherandhowtheissuerusesclimate-relatedscenarioanalysis,theextenttowhichandhowtheprocessesareintegratedintooverallriskmanagementprocess

MetricsandTargets

•Scope1and2GHGemissions

•Scope3GHGemissions1

•FurtherinformationregardingthemeasurementandcompositionoftheScope1,2and3GHGemissions,location-basedScope2GHGemissionsandcategoriesincludedinScope3GHGemissions

•Othercross-industrymetricsregardingclimate-relatedtransitionrisks1,physicalrisks1,climate-relatedopportunities1andrelatedcapitaldeployment

•Informationregardinguseofinternalcarbonprices

•Whetherandhowclimate-relatedconsiderationsarefactoredintoremunerationpolicy

•Industry-basedmetrics

•Qualitativeandquantitativeclimate-relatedtargetstheissuerhassettomonitorprogresstowardsachievingitsstrategicgoalsandanytargetstheissuerisrequiredtomeetbylaworregulationincludinganyGHGemissiontargets

•Informationabouttheissuer'sapproachtosettingandreviewingeachtargetandhowitmonitorsprogressagainsteachtarget

•Informationabouttheissuer'sperformanceagainsteachclimate-relatedtargetandananalysisoftrendsorchangesintheissuer'sperformance

1Withimplementationreliefsprovided(seebelowsection“ImplementationReliefswithrespecttospecificclimate-relateddisclosures”formoredetails)

ThefulltextoftheamendmentstotheListingRulesthatimplementtheNewClimateRequirementscanbefoundinAppendix

III(withrespecttoMainBoardListingRules)andAppendixIV(withrespecttoGEMListingRules)oftheConsultationConclusions.

ImplementationGuidanceandIFRSS1

InsupportoftheNewClimateRequirements,theHKEXhasissued

ImplementationGuidanceforClimateDisclosuresunder

HKEXESGreportingframework

(“ImplementationGuidance”)toassistissuersinunderstanding,interpretingandimplementingthenewrequirements.TheImplementationGuidance:

(a)setsoutprinciples,guidanceandillustrativeexamplesfortheimplementationoftheNewClimateRequirements,

(b)refersissuerstostep-by-stepworkflows,externalframeworksandtoolswhichwouldbehelpfulinthepreparationofdisclosuresand

(c)referencestheIFRSSDS(forexampletherelevantreportingprinciplesundertheIFRSS1andtheIFRSS2application

guidance)insofarastheyarerelevant/applicable;withrespecttothisAppendixVIoftheConsultationConclusionssetsouttherelevantIFRSS1reportingprinciplesandthelocationofcorrespondingdiscussionsintheImplementationGuidance.

WhiletheImplementationGuidancedoesnotconstitutepartoftheListingRules,theHKEXdoesencourageissuerstorefertoandapplytheImplementationGuidancewhenpreparingtheirclimate-relateddisclosuresunderthenewrequirements.TheImplementationGuidancewasdevelopedwiththeintentofassistingissuerstobetterpreparefortheeventualadoptionof

localHongKongSustainabilityReportingStandards(seelatersection“FuturestepsbyHKEX:localHongKongsustainabilitystandards,assuranceandotherissues”).

EffectivedateandthePhasedApproach

TheISSBAdoptionGuidePreviewpublishedbytheIFRSFoundationinFebruary2024setsoutproportionalityandphasingin

measuresfortheapplicationofIFRSSDSwithreferencetoanissuer’ssize,tradingvolumeandliquidity,allowingjurisdictionalregulatorstoclassifyissuersintodifferentmarkettiersandconsideranacceleratedintroductionoftheIFRSSDSformore

advancedissuers.TakingintoaccountmarketreadinessofHKEXissuersandleveragingontheseproportionalityandphasinginmeasures,theHKEXisadoptingaPhasedApproachthatsegregatesissuersinto:LargeCapIssuers,MainBoardIssuers(otherthanLargeCapIssuers)andGEMIssuerswithdifferentlevelsofdisclosurerequiredfromdifferenteffectivedatesaccordingtosuchtieredapproach.Thebelowtableshowsasummaryoftheeffectivedatesfortherequirementswithdifferentiationintothevarioustiers:

NewClimateRequirementsEffectiveDate

DisclosureonScope1andScope2GHGemissions

DisclosureotherthanScope1andScope2GHGemissions

LargeCapIssuers2

Mandatorydisclosure

•“Complyorexplain”:infinancialyearscommencingonorafter1January2025

(Financialyearscommencingonorafter1

January2025)

•Mandatorydisclosure:infinancialyearscommencingonorafter1January2026

MainBoardIssuers(otherthanLargeCapIssuers)

“Complyorexplain”

(Financialyearscommencingonorafter1

January2025)

GEMIssuers

Voluntarydisclosure

(Financialyearscommencingonorafter1

January2025)

2HangSengCompositeLargeCapIndexconstituents

Thetableaboveonlysummarisesissuers’disclosureobligationsunderPartDoftheESGCode.Non-climatedisclosure

requirementssetoutinPartsAtoCoftheESGCodewillcontinuetoapply.AllissuersmustcontinuetoreportontherelevantprovisionsintheirESGreports.Inparticular,GEMissuersshallcontinuetomakeclimate-relateddisclosurespursuantto

AspectA4:ClimatechangeofPartCoftheESGCodeona“complyorexplain”basis.

ImplementationReliefswithrespecttospecificclimate-relateddisclosures

TheHKEXacknowledgedconcernsexpressedbysomeconstituentsregardingthedifficultiesandchallengesofcomplyingwithsomeofthedisclosurerequirementsproposedintheConsultationPaper.Inresponse,thenewrequirementsdocontaina

numberofimplementationreliefsoriginatingfromtheIFRSSDS(“ImplementationReliefs”)designedtoaddressconcernsover

thereportingchallengesthatsomeissuersmayfacebyvirtueofalackofresourcesand/ortechnicalknowledgeandexpertise/otherdifficulties.AsummaryoftheImplementationReliefsiscontainedinthebelowtable:

RelevantNewClimateRequirements

ImplementationRelief

Reasonable

InformationRelief

CapabilitiesRelief

Commercial

SensitivityRelief

FinancialEffectsRelief

Allparagraphswithrespecttoclimate-relatedopportunities

√

Identificationofclimate-relatedrisksandopportunities

√

Determinationofthescopeofthevaluechain

√

Quantificationofcurrentandanticipatedfinancialeffects

√(anticipated

financialeffects

only)

√

Preparationofdisclosuresonanticipatedfinancialeffects

√

√

Useofclimate-relatedscenarioanalysis

√

√

Measurementapproach,inputsandassumptionsofScope3

GHGemissions

√

Calculationofmetricsin

particularcross-industrymetriccategories

√

ComparingtheamendedListingRuleswithIFRSS2

TherequirementsofthenewPartDofAppendixC2totheMainBoardListingRulesreflecttherequirementsofIFRSS2

(includingthereliefscontainedinthatStandard)tothemaximumextentpossible.TheHKEXhasstatedthatanESGreport

preparedincompliancewiththeIFRSSDS(i.e.,bothIFRSS1andIFRSS2)willbeconsideredtohavecompliedwithPartDof

theESGCode.AppendixVoftheConsultationConclusionscontainsatablecomparingtherequirementsofIFRSS2andthe

provisionsoftheHKEX'sESGCodeincludingtheNewClimateRequirements.InadditiontoAppendixV,ourobservations

stemmingfromacomparisonoftheNewClimateRequirements(asperPartDofAppendixC2oftheMainBoardListingRules)withtherequirementsofIFRSS2(operatinginconjunctionwithIFRSS1)arecontainedinthetablebelow:

PartDofAppendixC2ofMainBoardListingRulesascomparedtoIFRSS2(operatinginconjunctionwithIFRSS1)

•AlignedtotherequirementsofIFRSS2tothemaximumextentpossible;withonlylimiteddifferencesremainingincluding:

a)DisclosureofScope1andScope2GHGemissionsfortheconsolidatedaccountinggroupandotherinvesteesseparatelyisencouragedbutnotmandatory

b)Disclosureofpercentageofremunerationlinkedtoclimate-relatedconsiderationsisnotrequired

c)Whereanissuer’sactivitiesincludeassetmanagement,commercialbankingorinsurance,theissuerisencouraged

todiscloseadditionalinformationabouttheissuer’sCategory15GHGemissionsorthoseassociatedwithitsinvestments(financedemissions),butthisisnotmandatory

d)Anissuerisencouragedbutnotrequiredtodiscloseindustry-basedmetricsthatareassociatedwithoneormoreparticularbusinessmodels,activitiesorothercommonfeaturesthatcharacteriseparticipationinanindustry

•ImplementationReliefsareintroducedwhicharelargelysimilartopracticalexemptionsprovidedinIFRSSDS,forexample,ReasonableInformationRelief,CommercialSensitivityReliefandCapabilitiesRelief

•Materiality:Para11withinPartAtheHKEXESGCode(whichcontainsgeneralreportingprinciplesapplicabletoallParts)continuestodefinematerialityasthethresholdatwhichESGissuesdeterminedbytheboardaresufficientlyimportanttoinvestorsandotherstakeholdersthattheyshouldbereported(withmaterialitythereforenotconfinedtofinancial

materiality),whileIFRSSDSarebasedonaconceptofmaterialinformationfocusedonwhetherinformationcould

reasonablybeexpectedtoinfluencedecisionsthatprimaryusersofgeneralpurposefinancialreportsmakeonthebasisofthosereports,whichincludefinancialstatementsandsustainability-relatedfinancialdisclosures(i.e.financial

materiality).IntheConsultationConclusions,theHKEXstatesthattheListingRulesdonotpreventtheboardfrom

applyingafinancialmaterialitythreshold(asrequiredundertheIFRSSDS)indeterminingdisclosureofaclimate-relatedriskoropportunity.Indeedpara11hasbeenamendedtostatethatforthepurposeofPartDoftheESGCode,anissuermustdiscloseinformationaboutclimate-relatedrisksandopportunitiesthatcouldreasonablybeexpectedtoaffectitscashflows,itsaccesstofinanceorcostofcapitalovertheshort,mediumorlongterm.Atthesametime,theHKEX

makesclearthatissuersareallowedtopreparedisclosuresforthepurposesoftheNewClimateRequirementsunderthedoublematerialityapproachtoprovideadditionaldisclosurestomeettheneedofitsstakeholders.

•ReportingBoundary:Para15withinPartBoftheHKEXESGCodecontainsarequirementfornarrativeexplainingthe

reportingboundariesoftheESGreportanddescribingtheprocessusedtoidentifywhichentitiesoroperationsare

includedintheESGreport.TheHKEXstatesintheConsultationConclusionsthatwhileithasnointentiontochangethereportingprinciplesorotherrequirements(includingthereportingboundary)atthisjuncture,issuersareencouragedtofollowtheIFRSSDSandalignthescopeofentitiesoroperationsthatareincludedintheESGreport(includingthe

climate-relateddisclosures)withthatofitsfinancialstatements.

•Effectivedateis1January2025andaPhasedApproachisintroduced;whiletheeffectivedateofIFRSSDSis1January2024withlimitedtransitionprovisionsprovided

ComparingtheamendedListingRuleswiththePRCsustainabilityreportingguidelinesforlistedcompanies

On12April2024,undertheauspicesoftheCSRC,theShanghaiStockExchange,theShenzhenStockExchangeandtheBeijingStockExchangeissuedtheguidelinesforthesustainabilityreportingoflistedcompanies(“PRCGuidelinesforsustainability

reporting”),whichcontainextensiverequirementsapplicableonamandatorybasistoconstituentsofcertainstockindicesoncertainofthoseexchangesandavailableforvoluntaryadoptionbyremainingentitieslistedonthoseexchanges.Entitieslistedononeofthoseexchangespreparingasustainabilityreportpertheguidelines,whicharealsolistedontheHKEX(and

thereforesubjecttotherequirementsofthePartDofAppendixC2oftheListingRules)willneedtocomplywithbothsetsofrequirementsinrespectoftheirlistingsontherespectiveexchanges.Whilstthemainlandstockexchangerequirementsdo

drawoninternationalpracticeandexperienceselsewheretherearesomedifferencesintherequirementsascomparedtotheHKEXrequirements.Thefollowingtableprovidesasummaryofthemostsignificantcommonalitiesanddifferences:

PRCGuidelinesforsustainabilityreportingascomparedtoPartDofAppendixC2ofMainBoardListingRules

•Similardisclosurerequirementsacrossthefourcorepillarsandclimate-relateddisclosures

•Disclosurerequirementsarecategorisedintomandatory,encouragedandvoluntary

•Disclosureofclimate-relatedscenarioanalysis,anticipatedfinancialeffectsandScope3GHGemissionsisnotmandatory

•MeasurementofGHGemissions:ThePRCGuidelinesforsustainabilityreportingdonotprescribeanymeasurementmethod,whereastheGHGProtocolisthedefaultmeasurementmethodologyundertheIFRSSDS

•OtherthanGHGemissions,thePRCGuidelinesforsustainabilityreportingdonotprescribeothercross-industrymetrics

•Specificdisclosurerequirementsaremadefordesignatedtopics,suchasResourceUtilizationandCircularEconomyandRuralRevitalizationandSocialContributions,andnon-designatedtopicsthatareconsideredmaterialintermsofimpact

•Effectivedateis1May2024andlistedcompaniesshallpublishthefirstsustainabilityreport(i.e.2025report)before30April2026,withearlyadoptionencouraged

FurtherinformationinrelationtotheIFRSSDSandPRCsustainabilityreportingguidelinesforlistedcompaniesareavailablein

here

and

here

respectively.

FuturestepsbyHKEX:localHongKongsustainabilitystandards,assuranceandotherissues

AspartoftheVisionStatementpublishedbytheFSTB,thegovernmenthastargetedthelaunchin2024ofaroadmapontheappropriateadoptioninHongKongofIFRSSDSasappropriate,takingintoaccountHongKong’spositionontheglobalgreenfinancemap,aswellaslocalregulatoryexpectationsandcircumstances.Specifically,theHKICPAwillassumetheroleofthe

sustainabilityreportingstandardsetterinHongKongtodeveloplocalsustainabilityreportingstandardsalignedwiththeIFRSSDSaswellascomplementaryapplicationandimplementationguidance.Whentheseareavailable,theHKEXwillconsider

whetherandhowtotransitiontowardssustainabilityreportinginaccordancewiththoselocalstandards,includingwhethertoreplaceourcurrentESGregulatoryframeworkwithastraightforwardListingRulerequirementdirectinglistedissuersto

publishsustainabilityreportsinaccordancewiththosestandards(consistentwiththeapproachadoptedforfinancial

reporting).WhentheHKEXconsultsthemarketontheimplementationofthelocalstandards,itwillalsoconsiderwhetherandhowtoalignthenon-climatedisclosuresrequirementsundertheESGCodewiththosestandards.TheHKEXstatesinthe

ConsultationConclusionsthatuntilthattime,theNewClimateRequirementsserveasaninterimsteptoprepareissuerstowardssustainabilityandclimatereportinginaccordancewiththelocalstandardsascontemplatedundertheroadmap.

ConsistentwiththeproposalsintheConsultationPaper,theHKEXwillnotatpresentrequireindependentassuranceforESGinformationasagloballyacceptedassurancestandardhasyettobedevelopedwiththeInternationalAuditandAssuranceStandardsBoard(“IAASB”)workingonthis.However,theHKEXnotesthattheVisionStatementexpectsthatlocal

sustainability-relatedassuranceandethicsstandardswillbedeveloped,takingintoaccountlatestglobaldevelopments,

includingthosefromtheIAASB.Whensuchlocalstandardsareavailable,theHKEXwillassessthereadinessofissuersandthelocalESGecosystem,andconsiderrequiringindependentassuranceforsustainabilityinformationinaccordancewithsuch

localstandards.Inthemeantime,issuersareencouragedtoseekindependentassurancetostrengthenthecredibilityofESGinformationdisclosed,andmakerelevantdisclosureswhensuchassuranceisobtained(forfurtherinformationreferto

Question23ofHKEX’s

FrequentlyAskedQuestionsSeries18)

.

TheHKEXhasprovided,andwillcontinuetoprovide,trainingresourcesandmaterialsviaits

ESGAcademy,

aone-stopeducationalplatform,toassistissuerswiththeirESGreporting.Ithasalsostatedthatitwillprovidefurtherguidanceandtrainingasappropriate,basedonitsobservationsandreviewofissuers’compliance.

Practicalconsiderationsforissuersregardingimplementation

Diagnose&Assess

Plan

Communicate

•AssessinteractionsbetweenHKEX’sNewClimateRequirementsandtheapplicabilityofothersustainability-relateddisclosurerequirementsandframeworksthatthegroupmaybesubjectto;e.g.USSEC'srulesfor

climate-relateddisclosures,EU'sCorporateSustainabilityReportingDirective,thePRC'sGuidelinesforsustainabilityreportingandGRI

standards

•Clarifyreportingrequirementsandtimelinesinaccordancewiththe

PhasedApproach

•SeekadvicefromDeloitteprofessionalsonareasofcomplexity(e.g.scenario

analysis,reportingoffinancialeffectsandScope3GHGemissions)

•Assesstheimplicationsofclimatedisclosuresandhowthesecanbeintegratedintothegovernance

structure,strategysetting,risk

managementandinternalcontrols

•Identifykeygapsandimplicationsforsystems,personnel,dataand

processes,andliaisewithkeybusinessfunctionstoidentifythecorrectdataownersandassessdatareadinessforthenewqualitativeandquantitativedisclosurerequirements

•ConsidertheImplementationReliefsgiventhelimitationofresourcesandcapabilityoftheissuers

•Assessnewinformation(e.g.other

cross-industrymetricslikepercentageofassetsvulnerableto

transition/physicalrisksandcapital

expendituredeployedtowardsclimaterisk)tobedisclosedundertheHKEX'sNewClimateRequirements

•Consideraphasedimplementation

approachtobuildcapacityforclimate-relatedscenarioanalysis,quantificationoffinancialimpactsofclimate-relatedrisks,andmeasurementofGHG

emissions(Scope1,Scope2,andScope3emissions)

•Developaplantooperationalisethecapture,measurement,reviewandreportingofclimate-related

information

•Enhancegovernanceandcontrols

relatedtoESGdataanddisclosures;documenttheprocessesarounddatacollection,review,consolidationandcalculationusingrelevantemission

factors

•Considerif