Who qualifies as a sustainability professional? This is a matter that has yet to be settled. Employers in Hong Kong are seeking to hire people with experience in measuring the sustainability of a company or investment from the perspective of its environmental, social and governance (ESG) performance.
Such experience is increasingly sought after owing to the pressure on companies to disclose their ESG performance, amid a global and local push for them to reduce their carbon and other emissions, as well as improve their social impact. Companies are collecting data on their environmental and social performances because regulators, bankers, insurers and investors are demanding to see it – especially with respect to climate risks, since mitigating climate change is now a major endeavour across economies.
For example, the Hong Kong Monetary Authority, which regulates banks, is requiring lenders to report their climate risks. The banks, in turn, are asking their corporate clients to disclose their climate risks, because these are part of the bank’s risks.
The Securities and Futures Commission, which regulates the securities market, including the stock exchange, is also requiring similar disclosures of listed companies. The stock exchange has also been strengthening its ESG disclosure requirements.
Disclosure of environmental information is complicated because it is not just about one’s own emissions or the emissions one can control, such as how much energy a company generates or uses, but also the indirect emissions that are produced along a company’s supply chains, such as through purchased products and services.
The disclosure of social performance poses new challenges too. The social component of ESG boils down to relationships. It requires a company to address how it manages its relations with stakeholders: employees, suppliers, customers, shareholders and the communities in which it operates, often covering many jurisdictions.
The qualification is now quite widely accepted in Hong Kong and the institute is working with universities to align undergraduate environmental courses with its assessment so that graduates can be better equipped to pass the exam.
Within the corporate sector, finance firms are just as keen to hire green talent to meet global climate and sustainability goals. The Hong Kong Green Finance Association, a professional body focusing on finance, has been plugging the ESG talent gap by running courses to get finance professionals up to speed on sustainability issues, including collaborating with the Hong Kong University of Science and Technology (HKUST) on short-term courses.
HKUST started a groundbreaking – Hong Kong’s first – green finance undergraduate degree last year, in which students can gain a strong foundation in both environment and finance. This is the coming together of a broad range of knowledge covering environmental science, pollution control, economics, business and finance.
With Hong Kong’s aspiration to be a leading centre for green finance as declared by the government, organisations like the Hong Kong Institute of Qualified Environmental Professionals and the Hong Kong Green Finance Association have a role to play. There are opportunities for them to collaborate with universities and the authorities to upgrade Hong Kong’s capabilities in professional services, creating new industries, jobs and careers in the environmental and sustainability fields for our future generations.