HKEX Insight

Translating ambition into reality requires careful planning and execution, from aligning internally on a goal and baseline to measure progress, to calculating emissions of our own and our wider value chain, to sourcing the right ways and tools to reduce emissions and where we can’t reduce, purchasing carbon credits to balance the emissions.

We can distil three key learnings from this process.

First, know your supply chain. Developing emission targets requires a thorough assessment of sourcing methods and the environmental impact of all items in our expense records, from office chairs to hand soap.

Second, understand your objectives. While setting targets is crucial, ensuring they are realistic and adaptable to local conditions is equally important, as we learned when sourcing electricity from renewable sources to meet the needs of our offices.

Third, be agile. One way we offset emissions in 2024 was by purchasing carbon credits for nature-based projects in China, but we may have opportunities to invest in emerging technology-driven solutions like carbon capture in the future, and we will be prepared to take advantage of these innovations when they arrive.

It is here, as we imagine future inventions to bolster our fight against climate change, that we must take stock of what resources are currently at the disposal of companies in Hong Kong.

Our own path to carbon neutrality has pushed us to think even harder on how we can support our issuer community and the city’s broader corporate sector in the same undertaking.

Carbon markets, like Hong Kong’s Core Climate, offer a way forward to carbon neutrality, net zero and beyond, as they connect companies with the carbon credits required to offset their emissions in areas where they cannot reduce, and we are seeing growing interest and participation in these platforms.

To make full use of carbon markets, a company must be able to calculate the emissions produced through their operations and wider supply chain. The growth of Hong Kong’s carbon market is being matched by an ever-widening range of tools and local expertise that will help keep businesses on track.

At a higher level, there is a wider effort here in Hong Kong to lay out a roadmap for companies to enhance sustainability reporting and align with international best practices. Put together, this roadmap has the potential to help Hong Kong take the lead in sustainable finance and HKEX is proud to play our part in helping the ecosystem achieve this goal.

There has never been a better time for companies to step up, put sustainability at the core of their operations and play their part in committing to the climate action that the world needs.

We see a changing world unfolding around us. A world marked by rapidly evolving political sentiment, geopolitical turmoil and a shifting balance of economic power.

But even in the midst of all this change, some constants remain – and one of them is the enduring responsibility corporates hold to drive climate change action.

Since coming on board as HKEX’s first chief sustainability officer, I appreciate this now more than ever before.

The weather events of recent months show us that climate action can’t wait because climate change won’t.

The cost of failing to act will be staggering – it already is, as we look at the economic and human toll of the climate threats so far this year. As we look ahead, let this be a cause for corporates to rally around and drive forward.

Sustainability is a necessity for the long-term health and resilience of the communities, markets, economies and societies we are connected with. This is our opportunity to cut through the noise and take action to improve the world and address the challenge of climate change head-on.

So let us commit to climate action, invest in innovative solutions and work together across industries and borders.

Together we can create a sustainable future for generations to come. The world is watching, and the time to lead is now.

This article first appeared in Hong Kong Economic Times here and Eco-Business here.