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Hong Kong Exchanges and Clearing Limited

Name Hong Kong Exchanges and Clearing Limited (HKEX)
Country China
Number of listed companies 2568
Domestic market capitalization 4976487.08 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 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 any of the “comply or explain” provisions, it must provide considered reasons in its ESG report. The amendments had an emphasis in the board’s leadership role and accountability in ESG and the governance structure for ESG matters.

HKEX also introduced new climate change disclosure requirements and incorporated elements of the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) into our Rules. 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, Appendix 14 to the Listing Rules (here). With effect on 1 January 2022, the Corporate Governance Code was revised to further enhance corporate governance standards among listed issuers in Hong Kong, specifically in the areas of corporate culture, director independence and diversity. The Corporate Governance Code mandates that IPO applicants must have at least one female director on board and existing listed issuers must appoint at least one female director on their boards by the end of 2024.

Issuers are required to publish ESG reports (covering financial year commencing on or after 1 January 2022) at the same time as publication of annual reports. Consultation paper and conclusions 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.

In November 2021, the Exchange published a new guide “Guidance on Climate Disclosure” to help companies to assess their response to risks arising from climate change and to provide practical tips and step-by-step guidance to assist issuers in preparing TCFD-aligned climate change reporting.

Offers ESG related training Yes

All resources can be found on the HKEX ESG Academy, a centralised ESG educational platform launched in November 2021 to guide issuers and the broader business community in their sustainability journeys. The ESG Academy comprises several sections which houses all training and guidance materials published by the Exchange. In April 2022, the Exchange launched a new page headed “ESG in Practice” under the ESG Academy. The new section highlights the Exchange’s latest ESG regulatory developments, and provides examples of exemplary ESG practices amongst its issuers. 

The Exchange launched 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 November 2021, a webinar titled “Path to Decarbonisation with Climate Transparency” was held, where experts shared insights on leveraging enhanced disclosures and business strategies to achieve a company’s low-carbon goals.

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. 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

Women on boards mandatory minimum rule Yes

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 both on the ESG Academy and 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

Hong Kong Exchanges and Clearing Limited (HKEX) is a publicly-traded company (HKEX Stock Code:388) and one of the world’s leading global exchange groups, offering a range of equity, derivative, commodity, fixed income and other financial markets, products and services, including the London Metals Exchange.

As a superconnector and gateway between East and West, HKEX facilitates the two-way flow of capital, ideas and dialogue between China and the rest of world, through its pioneering Connect schemes, increasingly diversified product ecosystem and its deep, liquid and international markets.

HKEX is a purpose-led organisation which, across its business and through the work of HKEX Foundation, seeks to connect, promote and progress its markets and the communities it supports for the prosperity of all.

More information about HKEX and its subsidiaries is available on the HKEX Group website.

Criteria for Stock Exchange Database

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

Country Country of primary residence or registration
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.