Hong Kong raises ESG disclosure standards for MPF managers
The 12 fund managers have up to end-September to ensure their ESG disclosures match the new requirements
Hong Kong’s pension regulator said money managers would need to raise their disclosure standards on environment, social and governance (ESG) funds to help contributors understand their risk management and investment strategies
The 12 participating fund managers, or trustees, including HSBC and Manulife, should improve the transparency levels on ESG-related reporting in their pension schemes, the Mandatory Provident Fund Schemes Authority (MPFA) said on Monday.
The trustees must clearly state ESG strategies and focus on risk management in their brochures, as well as how they monitor and measure the ESG factors in their funds, managing director Cheng Yan-chee said. They should also assess their achievements and disclose them in annual governance reports to investors, he added.
“This approach enables scheme members to evaluate whether the funds’ ESG performance aligns with their expectations,” Cheng said. “It is also intended to help deepen their understanding of ESG funds and make better investment decisions.”
A total of 47 ESG-related funds with HK$36.6 billion (US$4.71 billion) of assets will be affected by the new measure, according to Kenneth Chan, an executive director in charge of MPF members and supervision. New ESG-themed funds would also need to comply when launched, he added.
While the directive was effective immediately, the fund managers would be given until September 30 to ensure their ESG disclosure levels match the new guidelines, Cheng added.