Chinese Companies Look to Hong Kong for ESG Guidance

August 27, 2021 | BY

Vincent Chow

Hong Kong has played a key role in familiarizing PRC clients with tightening ESG requirements, lawyers say, and it will continue to do so as the city further bolsters rules in this area

Summary

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  • China has introduced first mandatory environmental disclosure requirements for all listed companies
  • Investor pressure pushing companies to improve ESG practices, more so than regulatory enforcement

Mandatory environmental, social and governance regulatory requirements are beginning to take shape in mainland China.

The ESG landscape is transitioning from semi-mandatory rules to mandatory, at a time when PRC companies are increasingly aware of the importance of ESG for attracting both foreign and domestic investment. Hong Kong has played a key role in familiarizing PRC clients with tightening ESG requirements, lawyers say, and it will continue to do so as the city further bolsters rules in this area.

With more than 200 PRC companies listed in Hong Kong, the listing rules in the Hong Kong Stock Exchange (HKEX) play an important role in familiarizing the companies with global ESG trends, says Alexander Burdulia, a registered foreign lawyer at Mayer Brown in Hong Kong and a founding member of the Firm's ESG Steering Committee.

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