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Hong Kong Exchanges and Clearing Limited

Name Hong Kong Exchanges and Clearing Limited (HKEX)
Country China
Number of listed companies 2549
Domestic market capitalization 6759774 million US$
SSE Partner Exchange Yes
Has annual sustainability report Yes

ESG reporting required as a listing rule Yes

Issuers must publish their ESG reports on an annual basis and regarding the same period covered in their annual reports. Reporting requirements can be found in the related Main Board Listing Rules (here) and the ESG Reporting Guide (the “Guide”), Appendix 27 to the Main Board Listing Rules (here).

Following the conclusions to the consultation on the ‘Review of the ESG Reporting and Related Listing Rules’, the revised Guide, effective on 1 July 2020, comprises two levels of disclosure obligations: (a) mandatory disclosure requirements; and (b) “comply or explain” provisions. Issuers must disclose the information required under the “Mandatory Disclosure Requirements”; and if the issuer does not report on one or more of the “comply or explain” provisions, it must provide considered reasons in its ESG report. Consultation paper and conclusions on ESG Reporting Guide can be found here.

Disclosure requirements on corporate governance issues are contained in the Corporate Governance Code and Corporate Governance Report, Appendix 14 to the Listing Rules (here). The Exchange published a consultation paper outlining proposed enhancements to the Corporate Governance Code and Corporate Governance Report, as well as related amendments to the Listing Rules. The proposals include new measures aimed at further enhancing corporate governance standards among listed issuers in Hong Kong, specifically in the areas of corporate culture, director independence, diversity, and in ESG disclosures and standards. Consultation paper on the amendments can be found here.

Has written guidance on ESG reporting Yes

Written guidance on ESG Report includes:

In December 2020, the Exchange published the Practitioners Insights which presents a collection of experiences shared by market practitioners, with an aim to help directors of listing applicants and newly listed companies think holistically about building and integrating corporate governance and ESG considerations into their business strategy to achieve long-term value for their organisations.

In March 2020, the Exchange (i) updated the its “How to prepare an ESG report” to reflect the new ESG requirements (including adding a new appendix with specific guidance on the calculation of key performance indicators under the “Social” Subject Area of the ESG Reporting Guide); and (ii) published a new guide tailored for board and directors titled “Leadership role and accountability in ESG” to help directors in understand and carry out their leadership role in ESG.

Offers ESG related training Yes

All resources can be found on the Exchange’s dedicated Environment, Social and Governance (ESG) webpage, which includes:

The Exchange launches e-training courses, for directors to help them develop and refresh their knowledge and skills so as to ensure that their contribution to the board remains informed and relevant.

In May 2021, the ESG Academy Webinar Series was launched to deepen ESG understanding and knowledge among listed issuers and the wider business community, and facilitate the integration of ESG considerations into their decision making processes.

In December 2020, we launched the Sustainable and Green Exchange, STAGE, Asia’s first multi-asset sustainable investment product platform that includes ESG-related case studies, guidance materials and publications within its online resources library.

In March 2020, an e-training course titled “Exchange’s New ESG Requirements” was launched to discuss the Exchange’s new ESG reporting requirements.

In May 2019, an e-training course titled “ESG Governance and Reporting” was launched to explain the board’s leadership role in ESG matters.

HKEX representatives also gave presentations at events organised by various non-governmental organisations and professional organisations to identify the latest trends and share practical advice in relation to ESG reporting.

The Director Training Programme 2017/2018 also covers the topic of ESG reporting.

Market covered by sustainability-related index Yes

Has sustainability bond listing segment Yes

At the heart of STAGE is an online product repository, which provides access and transparency on sustainable finance products, including sustainability, green, and transition instruments from issuers across a variety of sectors. As of 15 June 2021, 66 investment products have been included onto STAGE. STAGE is also an online source of sustainable and green finance educational resources, promoting knowledge sharing and stakeholder engagement.

Has SME listing platform Yes

  • GEM, since 1999

Additional information
HKEX has been rated highly and awarded by both local and overseas rating agencies or professional institutions, in recognition of its achievement in corporate governance and CSR. More details are available on the HKEX Group website.

As part of the Exchange’s ongoing initiative to raise the overall standard of ESG performance and disclosures among issuers, the Exchange has conducted market consultations on proposed changes to the ESG reporting requirements under the Listing Rules.

In addition, the Exchange conducts periodic review of issuers’ ESG disclosures and publishes its findings on the HKEX Market website.

Organizational model of stock exchange
  • Listed company for profit; demutualized in 2000.

Regulatory bodies

Regulatory model
HKEX is a recognised exchange controller under the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). The Exchange is responsible under statute for ensuring, so far as reasonably practicable, that the Hong Kong markets are fair, orderly and informed (the Exchange’s statutory duty). The Securities and Futures Commission performs a lead role in market regulation and certain areas of listing regulation and a complementary role through the exercise of its statutory powers by providing investigation and enforcement in cases involving corporate misconduct. Details of the regulatory framework of Hong Kong’s securities market are available on the HKEX Market website.

About the stock exchange
Location: Hong Kong

As one of the largest financial market operators in the world, HKEX and its subsidiaries provide world-class facilities for trading and clearing securities and derivatives in equities, commodities, fixed income and currency. Headquartered in Hong Kong, the Group has offices in London, Beijing, Shanghai, Shenzhen and Singapore.

In Hong Kong, HKEX is a recognised exchange controller under the Securities and Futures Ordinance. Through its subsidiaries, HKEX operates the securities and derivatives markets and is the frontline regulator of listed issuers in Hong Kong. It also provides clearing and settlement services, depository and nominee services, and information services across multiple products and asset classes.

In collaboration with the Shanghai and Shenzhen stock exchanges, HKEX operates Stock Connect, a mutual market access programme which gives investors in the Hong Kong and Mainland securities markets access to the other market. In London, HKEX owns The London Metal Exchange (“LME”), an exchange for the trading of futures and options contracts on base and other metals, and LME Clear Limited which provides clearing and settlement services for all exchange contracts traded on the LME.

HKEX was listed in Hong Kong in 2000.  More information about HKEX and its subsidiaries is available on the HKEX Group website.

Stock Exchange Database Criteria

The SSE maintains a database of sustainability activities for all stock exchanges that are either members of the SSE initiative and/or members of the World Federation of Exchanges. This database is the most comprehensive database of stock exchanges worldwide and contains data on all main stock exchanges. The information in this database is intended to inform investors and other stakeholders on the work stock exchanges are undertaking to advance sustainability in their respective markets.

The information provided in this database is based on publicly available information prepared by the SSE Secretariat with input from stock exchanges in most instances. Sources and explanatory notes on sustainability information have been included in individual Stock Exchange Fact Sheets. The criteria for each category can be found below.

While every effort is made to keep the information in this database up to date, please be aware that certain factors change frequently and therefore may not be exact, such as the number of listed companies or market cap.

Field

Criteria Considered

Conducts business in Country or Market in which the stock exchange operates
Number of listed companies (Date updated) Updated either by the stock exchange directly or using WFE data
Domestic market capitalization  Updated either by the stock exchange directly or using WFE data
Has signed the SSE Commitment Letter? To be considered an SSE Partner Exchange, the CEO or Chairperson of the exchange must sign an SSE commitment letter. Contact the SSE for more information if your exchange would like to join.
Has annual sustainability report? For a yes, stock exchanges must report, either in a stand alone report or integrated into their financial report, on their environmental and social impact and corporate governance.
ESG reporting required as a listing rule? For a yes, all three factors have been considered (environmental, social and governance) within the listing rules for some or all listed companies. This requirement may come from the regulatory authority or the exchange, depending on the market.
Offers written guidance on ESG reporting? For a yes, all three factors have been considered (environmental, social and governance). The SSE has developed a model guidance that all exchanges can use to develop their own guidance to issuers. For more details, click here.
Offers ESG related training? For a yes, training must have taken place in the previous 12 months, and must be interactive. The topic of the training must be on some area of sustainability.
Market covered by sustainability-related index? Sustainability-related indices may include environmental or social  indices, or ESG indices. This could include specific themes, such as low carbon indices, or general sustainability indices. The index must be specific to the market the exchange operates in (a region or world index is not included).
Has sustainability bond listing segment? For a yes, the exchange has developed the rules and regulations allowing for sustainability bonds to be listed, and provides a separate segment for listing making the bonds easy to find and identify.
Has an SME listing platform? For a yes, the exchange offers a listing platform specifically for Small-and-Medium sized enterprises.
Additional Information Additional Information captures exchanges’: sustainability section of websites,  sustainability products not captured under indices; information on future sustainability commitments and other information on the exchange
Organizational model of stock exchange Whether the exchange is listed or not, and when it was demutualized
Regulatory bodies The regulatory authority that sets listing requirements and capital market regulation for the exchange's market
Regulatory model

The extent to which exchanges have regulatory authority in their market. This may include: 

  • Limited exchange SRO
  • Strong exchange SRO
  • Independent member SRO
  • Government (Statutory)
  • Non-SRO
About the stock exchange The location of the headquarters of the exchange, and any additional details about the stock exchange.