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SEEDing change: A practical ESG framework for Hong Kong enterprises
  • Sustainability
    • Transition to Net Zero

SEEDing change: A practical ESG framework for Hong Kong enterprises

Article

  • Article

Sustainability and Environmental, Social and Governance (ESG) considerations have become essential factors that shape how businesses operate and grow in today’s market.

We recently hosted a roundtable discussion for Technology, Media and Telecommunications, Healthcare and Pharmaceuticals, Services and Consumer sectors, that focused on how businesses could approach ESG in a practical, manageable way, and insights shared were relevant across Hong Kong’s diverse commercial landscape.

To summarise these key takeaways, we introduce the SEED framework, Support, Education, Enablement and Disclosure. These four pillars capture the key elements that help businesses starting their ESG journey effectively integrate sustainability into their operations.

Why ESG matters to businesses of all sizes in Hong Kong?

  • Hong Kong has become one of the first jurisdictions globally to fully align its local sustainability disclosure requirements with the IFRS Sustainability Disclosure Standards (ISSB Standards). 1 This milestone reflects the city’s commitment to enhancing transparency in sustainability reporting and its ambition to strengthen its position as a global sustainable finance hub.
  • The disclosure framework primarily targets publicly accountable entities and listed companies, with phased compliance starting in 2025 and mandatory adoption by 2028. However, non-listed companies are increasingly recognising the need to prepare for these changes and to embed sustainability into their business models.
  • SMEs is a vital part of the supply chains for listed companies, large non-listed firms, and multinational corporations operating in Hong Kong. Their ability to collect and share sustainability-related information supports these larger companies’ ESG commitments.

Sector snapshots: Key opportunities

Healthcare and Pharmaceuticals

Healthcare and Pharmaceuticals

  • The pervasive contamination of ecosystems with active pharmaceutical ingredients poses a serious threat to biodiversity, ecosystem services and public health.
  • A recent study also measured 61 different drugs in river water from 1,052 locations across 104 different countries, finding that approximately 43% of sites had drug levels exceeding safe ecological thresholds.3
  • Several international pharmaceutical companies have pledged to achieve net zero emissions by 2050 and are actively replacing fossil-fuel-derived chemicals used in small-molecule drugs with synthetic biology to reduce carbon emissions.4

Services

Services

  • Professional service firms play a role in supporting supply chain decarbonisation through advisory, financing and facilitating client transition.
  • For example, Ronald Lu & Partners became the first architecture firm in China to commit to reducing operational carbon emissions aligned with the 1.5°c target set by the Science Based Targets initiative. 5

Consumer

Consumer

  • Some of the world’s leading consumer brands are driving the transition to a circular business model by extending product lifecycles from initial design, manufacturing and distribution to recycling incentives, reducing their environmental footprint while maximising the value of their products. 6
  • Consumer attitudes are shifting. A 2024 survey found that 57% of Hong Kong consumers believe their favourite brands could do more on sustainability, and 78% are willing to pay more for sustainable products, 7 reflecting a clear desire to engage in sustainable consumption.

Technology, Media and Telecom (TMT)

Technology, Media and Telecom (TMT)

  • Estimates suggest that data centres accounted for around 1.5% of the world’s electricity consumption in 2024. Since 2017, global data centre electricity consumption has grown by around 12% per year. This is more than four times faster than the rate of total electricity consumption. 8
  • This presents opportunities for the TMT sector to support the transition of greener and more efficient digital technologies.

Overcoming ESG challenges: The SEED Approach

Many businesses face common challenges: limited time, expertise, and resources to develop and implement ESG strategies. The SEED framework may offer a clear path forward.

hsbc-sustainable-roundtable-article-graphic-en
Support

Support

  • Developing a sustainability strategy can be challenging, especially when balancing day-to-day business demands.
  • We launched the HSBC Sustainability Improvement Loan to help improve businesses’ access to sustainable finance, particularly for those in the early stages of their sustainability journeys.
  • This loan links the cost of financing to sustainability performance improvements, assessed and rated by EcoVadis, one of the leading global providers of sustainability intelligence and ratings. ⁹
  • This year, we’ve also introduced Energywi$e and Wastewi$e Certificates under Hong Kong Green Organisation Certification into the programme. These assessments help companies benchmark their energy efficiency and waste management, identify areas for improvement and support ongoing progress.
Education

Education

  • Educational institutions can contribute to sustainable development by integrating long-term thinking into their curricula and research priorities.
  • By integrating ESG principles into the curricula and partnering with industry organisations for pre-employment training, educational institutions can help develop workforce capabilities aligned with sustainability-related skills and practices.
  • Corporates can further support their workforce through capacity building, industry roundtables and programmes that facilitate knowledge sharing and access to useful resources, enabling employees to contribute effectively to their organisation’s sustainability goals.
Enablement

Enablement

  • Digital tools are increasingly important for businesses to monitor and improve their ESG performance while reducing compliance and reporting costs.
  • Platforms like Diginex and MioTech offer intuitive, accessible data analytics, sustainability reporting and risk management solutions that connect business data and helps break down data silos.
  • This supports businesses to improve energy efficiency, track and reduce carbon emission, and assess ESG and climate risks across operations and value chains.
  • Our HSBC Sustainability Tracker also offers a simple, free to use self-assessment tool that gives businesses suggestions to drive sustainable improvements while allowing them to benchmark against similar companies.
Disclosure

Disclosure

  • Transparent ESG disclosure can help businesses demonstrate their commitment to sustainability and respond to increasing stakeholder expectations.
  • Certification bodies offer tailored services to help businesses verify and communicate their sustainability credentials. These certifications provide credible, independent assurance of a company’s ESG practices, which can enhance trust with customers and business partners.

Sustainability is not about perfection but progress. For businesses in Hong Kong, the above SEED framework could offer a practical roadmap to plant the seeds of meaningful change and responsible growth.

By taking deliberate, measurable steps and seeking expert guidance, businesses across industries can transform ESG from a compliance checklist into a catalyst for innovation, resilience and long-term value creation. At HSBC, we will continue to help businesses strategically tap into ESG opportunities, partnering with them every step of the way.

Anita Ou | Managing Director, Head of Enterprise Banking, Commercial Banking, Hong Kong, HSBC.

Today we finance a number of industries that significantly contribute to greenhouse gas emissions. We have a strategy to help our customers to reduce their emissions and to reduce our own. Find out more about our climate strategy.

Reminder “To borrow or not to borrow? Borrow only if you can repay!”

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  • Sustainability
    • Transition to Net Zero