Navigating the Evolving Sustainable Landscape: Hong Kong's Crucial Role in Financing Transition to Sustainability
28 Nov 2024
Over the past decades, green and sustainable finance development has emerged as a top priority in global discourse. With the Financial Services Development Council (FSDC) releasing its inaugural report on this topic in 2016,1 Hong Kong was spotlighted as a nascent hub for green finance, poised to transform into a significant player in the field of sustainable economic practices. Since then, capitalising on the city’s status as an international financial centre, the Hong Kong SAR Government has embraced a series of strategic initiatives aimed at cultivating a sustainable finance ecosystem. These measures, many of which align with FSDC recommendations, encompass the formulation of strategies for public and private stakeholders, the development of regulatory frameworks, and the promotion of green and sustainable products.
The sector’s growth from nascency to vibrancy was highlighted in FSDC’s 2022 publication, which showcased the concerted efforts of key industry players in fostering a thriving sustainable investment ecosystem in Hong Kong. The publication underscored the city’s successes as a rising international green and sustainable finance centre.
While considerable progress has been made, the landscape of green and sustainable finance is in constant flux, propelled by the urgency of climate-related challenges and shifting geopolitical dynamics. In 2023, the International Renewable Energy Agency (IRENA) highlighted the economic potential of transition towards a low-carbon economy, projecting a US$150 trillion investment opportunity by 2050.3 Global discussions have expanded, underscoring the need for enhanced efforts to bridge existing gaps that green finance alone cannot address, calling for broader stakeholder involvement to create a more inclusive sustainable finance environment.