Biodiversity poised to be part of international sustainability reporting standards for businesses after ‘milestone’ vote

Attendees of the COP27 climate summit in Sharm el-Sheikh, Egypt in 2022. Photo: Reuters

The standards could become the basis for authorities around the world to regulate such disclosures, according to McKenzie, who was in Hong Kong last week to attend the launch of TNFD Recommendations Hong Kong, organised jointly with Swire Properties, the city’s only representative in the 40-member task force.

The TNFD – backed by G20 nations, businesses and financial institutions worldwide – was launched in June 2021 to devise an internationally recognised framework for nature-related corporate disclosures.
Seven Hong Kong companies have joined more than 360 firms worldwide committed to making disclosures on nature-related risks and opportunities aligned to the recommendations of the TNFD.

They include property developers Swire, Chinachem Group, Henderson Land Development and Sino Land, gas utility Hong Kong and China Gas (Towngas), beverage maker Vitasoy International Holdings, and marine ecosystems restoration start-up Archireef.

“Hong Kong’s status as an international financial centre can help bring plans and actions together to promote sustainable transformation,” said Salina Yan Mei-mei, Permanent Secretary for Financial Services and the Treasury, at the TNFD launch event.

“We will closely monitor global developments and align with international standards as appropriate,” she said.

At the inaugural One Earth Summit in Hong Kong last month, Secretary for Financial Services and the Treasury Christopher Hui laid out the city’s goal to be among the first jurisdictions to align local sustainability disclosures with benchmarks published by the ISSB.

The ISSB’s plan to formulate biodiversity disclosure standards has long been expected, according to Kelly Lee, senior vice-president in the policy and secretariat services unit of the listing division of Hong Kong Exchanges and Clearing (HKEX), the city’s bourse operator.

A forest in China’s Inner Mongolia province of China. Photo: Shutterstock

“Even under the existing rules, listed companies are already required to disclose the impact of your business on the environment and natural resources,” she said during a panel at the TNFD launch event “This is not something new, and [firms] have already been doing it all these past years.”

“The new climate requirements form part of the wider Hong Kong road map for the local adoption of the ISSB Standards,” said Katherine Ng, HKEX’s head of listing in a statement.

“This will be an important part of our ongoing efforts to prepare listed companies towards eventual sustainability reporting in accordance with the local sustainability disclosure standards under development, enhancing Hong Kong’s capital markets attractiveness and competitiveness.”

The ISSB said it intends to finalise its next work plan in the first half of this year.

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