The "Guidelines for Sustainability Reporting of Listed Companies" came into effect on May 1, and the disclosure of sustainable information is becoming standardized and mandatory

The Guidelines for Sustainability Reporting of Listed Companies (hereinafter referred to as the "Guidelines") were officially implemented on May 1, encouraging A-share listed companies to publish sustainability reports or ESG reports, and putting forward specific requirements for the reporting framework and content. This is China's first systematic ESG information disclosure rules for listed companies, marking that sustainable information disclosure has gradually become standardized and mandatory.

"Channeling more finance to areas that promote sustainable development"

The Guidelines divide the disclosure into three dimensions: environmental, social and governance, and set up 21 specific topics, of which climate change is listed as the first topic.

"The improvement of the completeness, reliability and comparability of high-quality information disclosure, especially carbon emissions-related climate information disclosure, can not only help market players better respond to domestic and foreign regulatory policy requirements, reduce corporate financing costs, and enhance the global competitiveness and supply chain status of enterprises, but also make it easier for investors to obtain relevant information, thereby guiding more funds to promote sustainable development and investment targets, and promote the mainstream development of sustainable investment." At the recent Shanghai Climate Week 2024 Green Finance and Sustainable Development Forum, Li Xiaozhen, Director of Sustainable Finance at the World Resources Institute (WRI) Beijing Office, spoke about the importance of information disclosure in promoting sustainable development.

For both enterprises and financial institutions, high-quality climate information disclosure is not only to meet regulatory requirements, but also to reduce costs and enhance their competitiveness.

In 2023, the International Maritime Organization (IMO) adopted its latest emission reduction strategy, which aims to achieve net-zero emissions for the global shipping industry around 2050. As China's largest port joint-stock enterprise and a comprehensive port with the world's largest cargo throughput and container throughput, SIPG's exploration and experience in promoting the green and low-carbon transformation of ports is an important topic on a global scale. Luo Wenbin, Executive Director and General Manager of SIPG Energy Company, introduced their work to promote green transformation in conjunction with the Guidelines at the forum.

"The key to the green development of ports lies in how to achieve a green energy transition in the stevedoring and shipping processes, so we must first know the energy consumption. We do a lot of work in this area, such as accurately measuring the main equipment, how much energy each equipment consumes over how long, how much greenhouse gases it emits, etc. At the same time, these data are regularly measured and compared vertically and horizontally, and on this basis, the proportion of energy efficiency and green energy is improved. ”

Zhang Jiao, General Manager of the Sustainable Finance Division of HSBC (China) Commercial and Commercial Financial Services, believes that from the perspective of financial institutions, high-quality information disclosure can help commercial banks obtain a relatively fair benchmark, and help banks focus on the performance indicators that enterprises are mainly concerned about in a specific industry. Based on these effective data, different linked financial products are formulated for different sub-sectors to better support the sustainable transformation of enterprises.

"Enterprises need to continue to improve the accuracy of ESG data and the quality of information disclosure"

With the official implementation of the Guidelines, as the "pioneer and main force" of sustainable development of enterprises, the information disclosure of listed companies has ushered in more challenges and opportunities.

"More and more listed companies have begun to pay attention to and actively disclose sustainable development information, but at present, due to the lack of unified standards and norms, there are great differences in the content, method and frequency of disclosure between different companies, and the quality and comparability of information are also uneven. Zhang Junjie, chief economist of the Green Finance 60 Forum (GF60) and professor at Duke University, suggested that enterprises can continuously improve the quality of sustainability reports from two aspects: completeness and effectiveness, in combination with international rules and the spirit of the Guidelines.

The first is to pay attention to the completeness of the disclosed information. Zhang Junjie said: "I hope that listed companies will not selectively disclose. For example, some listed companies do not disclose Scope 3 (indirect emissions from the upstream and downstream of the value chain), and some do disclose but are not clear. ”

The second is to pay attention to the effectiveness of the information disclosed. Zhang Junjie believes that the non-financial information disclosure of listed companies is diverse, and there is a lot of invalid information in it, and it is difficult for investors and third-party institutions to extract effective information from the complicated content. Therefore, companies need to pay more attention to the information density of their disclosures and effectively reflect their climate strategies and actions in their reports.

"We often say that information disclosure is the foundation, evaluation and rating are the starting point, and investment and financing are the results. One of the biggest challenges for banks in the past was the lack of authoritative, high-quality information, which made it difficult to assess where money was invested. The Guidelines address this issue. Wu Yanyang, a senior researcher at Industrial Research, said that the "Guidelines" require participants to disclose their own information fairly, transparently and objectively, and as investment institutions and asset management institutions, they will be more confident and confident in building their own investment strategies and developing their own investment products based on this information.

"Information disclosure is a method rather than an end in itself, and information disclosure alone cannot solve all problems, and should be regarded as the starting point for disclosing entities and financial institutions to practice climate action. Wei Tiange, head of the Asia Pacific region of the Financial Alliance for Carbon Accounting (PCAF), said.