ESG360 offers specialized climate disclosure services tailored to meet the stringent reporting requirements set by the International Sustainability Standards Board (ISSB) and the Hong Kong Exchanges and Clearing Limited (HKEX) ESG Code. Our services are designed to help organizations enhance transparency, comply with international and local regulations, and communicate their climate-related risks and opportunities effectively to stakeholders.


Key Components of ISSB Climate-Related Disclosure Requirements:

The International Sustainability Standards Board (ISSB) was established by the IFRS Foundation to develop a comprehensive global baseline of sustainability-related disclosure standards. These standards aim to provide investors and other capital market participants with consistent, comparable, and reliable information on companies' sustainability-related risks and opportunities. Although the full suite of ISSB standards continues to evolve, the initial focus has included significant emphasis on climate-related disclosures.

  1. Scope of Disclosures:
    • Companies are required to disclose information on how climate-related risks and opportunities affect their strategies, business models, and cash flows over short, medium, and long-term horizons.
  2. Governance:
    • Organizations must disclose their governance arrangements concerning climate-related risks and opportunities, including the board’s oversight and management’s role in assessing and managing these risks and opportunities.
  3. Strategy:
    • Companies should describe the climate-related risks and opportunities they have identified, their impact on the business, strategy, and financial planning, and how these risks and opportunities are managed. This includes explaining the resilience of the organization’s strategy under different climate-related scenarios.
  4. Risk Management:
    • Disclosures must include how the organization identifies, assesses, and manages climate-related risks and integrates those processes into its overall risk management.
  5. Metrics and Targets:
    • Companies need to provide metrics and targets used to assess and manage relevant climate-related risks and opportunities. This typically includes the disclosure of Scope 1, Scope 2, and, if relevant, Scope 3 greenhouse gas emissions, as well as other specific metrics such as energy usage, water consumption, and waste management.


Implementation of ISSB Standards:

  • Global Baseline: The ISSB standards are intended to serve as a global baseline that jurisdictions can further supplement to meet specific needs. They are designed to align with, and build upon, existing frameworks such as the Task Force on Climate-related Financial Disclosures (TCFD) and the recommendations of other sustainability-focused organizations.
  • Adoption and Compliance: Adoption of ISSB standards will depend on decisions by individual jurisdictions regarding how these standards are incorporated into local regulatory frameworks. However, the aim is that any entity that prepares general-purpose financial reporting can use these standards to report on sustainability-related matters.


Importance of ISSB Climate Requirements:

The ISSB's climate requirements are vital for promoting transparency in how organizations manage significant climate-related risks and opportunities. This transparency helps investors and stakeholders make more informed decisions regarding the sustainability and climate resilience of their investments. Additionally, uniform reporting standards improve comparability across companies and industries, facilitating better assessment and management of climate risks in global investment portfolios.

As the ISSB continues to develop and finalize its standards, companies are encouraged to stay informed about the evolving requirements and prepare their reporting processes to meet these new global benchmarks for sustainability disclosure.


Key Aspects of HKEX's Enhanced Climate Requirements:

  1. Mandatory Disclosure Requirements (MDRs):
    • HKEX has moved certain ESG aspects from "encouraged" or "voluntary" to "mandatory". This includes the enhanced disclosure of climate-related risks, which are part of the broader ESG reporting guide that all listed companies must follow.
  2. Alignment with TCFD Recommendations:
    • HKEX’s updates increasingly reflect the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). Companies are expected to disclose their climate-related risks and opportunities, governance around climate risks, risk management, strategy, and metrics and targets.
  3. Quantitative Metrics and Targets:
    • Companies are now required to provide more quantitative disclosures, including metrics on greenhouse gas (GHG) emissions, energy consumption, and water usage. These metrics help stakeholders gauge the company's environmental impact and its progress towards set environmental targets.
  4. Board Involvement:
    • HKEX emphasizes the role of the board and senior management in overseeing ESG and climate-related issues. Companies must disclose how their boards oversee climate-related issues, including the frequency of discussions on these topics.
  5. Scenario Analysis:
    • Listed companies are encouraged to undertake climate-related scenario analysis and disclose how potential changes in climate could affect their business. This includes discussing the resilience of the company’s strategy under different climate-related scenarios.

Compliance Timeline:

  • Gradual Implementation: HKEX has typically provided a phased approach to implementing new reporting requirements, offering companies time to adjust their internal processes to comply with new standards.

Importance of Compliance:

Compliance with these requirements is crucial not only for regulatory reasons but also for improving investor confidence and public trust. Investors are increasingly considering climate-related factors as critical elements in their investment decisions. Transparent reporting on these issues can enhance a company's reputation, mitigate potential risks, and uncover new opportunities for growth and innovation.

Preparing for Compliance:

Companies listed on the HKEX should:

  • Review their current ESG reporting practices and align them with the enhanced requirements.
  • Engage with stakeholders, including investors, to understand their expectations regarding climate-related disclosures.
  • Invest in systems and expertise to capture the required data accurately and efficiently.
  • Consider external assurance to enhance the credibility of their ESG reports.


Service Highlights:

  1. Tailored Reporting Frameworks:
    • We develop customized climate disclosure frameworks based on the specific requirements of the ISSB standards and the HKEX ESG Code. Our approach ensures that all relevant climate-related information, from greenhouse gas emissions to climate risk management and resilience strategies, is accurately captured and reported.
  2. Data Collection and Analysis:
    • ESG360 assists in the rigorous collection and analysis of environmental data necessary for detailed climate reporting. This includes GHG emissions inventory, energy usage, water consumption, and waste management data, ensuring comprehensive coverage of all relevant environmental aspects.
  3. Risk Assessment and Scenario Analysis:
    • We conduct thorough climate risk assessments and scenario analyses to help organizations understand potential financial impacts under different climate-related scenarios. This analysis aids in aligning business strategies with sustainable practices and prepares companies for future climate conditions.
  4. Compliance and Best Practice Integration:
    • Our services ensure that your climate disclosures not only comply with the latest ISSB and HKEX guidelines but also incorporate best practices from around the world, enhancing the credibility and quality of the reports.
  5. Stakeholder Communication:
    • We aid in crafting clear and impactful communications for stakeholders, including investors, regulators, and the public. This ensures that the disclosed information is transparent, understandable, and demonstrates the organization’s commitment to managing climate-related issues.


Why Choose ESG360 for Climate Disclosure Services?

  • Expertise in ISSB and HKEX Requirements: Our team has in-depth knowledge of the ISSB and HKEX reporting standards and stays updated with the latest developments to provide you with the most accurate guidance.
  • Customized Solutions: We understand that each organization faces unique challenges and opportunities in climate reporting. ESG360 provides tailored solutions that reflect your specific business context and sustainability goals.
  • Enhanced Data Integrity: We use advanced tools and methodologies to ensure the accuracy and reliability of your climate data, providing a solid foundation for your disclosures.
  • Strategic Advisory: Beyond compliance, we offer strategic insights to enhance your environmental performance and integrate climate considerations into your core business strategy effectively.


Get Started with ESG360

Leverage ESG360’s expertise in ISSB and HKEX climate disclosure to elevate your sustainability reporting and meet the growing demands of regulators and investors. Contact us today to learn more about how our services can help your organization achieve transparency, compliance, and sustainability leadership in the realm of climate disclosure.



ESG360 Climate Disclosure Services Based on ISSB and HKEX ESG Code