Core Insights - The report by Grant Thornton (Hong Kong) indicates an improvement in ESG reporting among large listed companies in Hong Kong, particularly in climate-related disclosures and green finance, although many companies remain unprepared [1][2][3] ESG Reporting and Compliance - In 2024, 95% of large Hang Seng Index constituent companies disclosed climate-related risks, a 6% increase from 2023 [2] - Only 10% of companies are fully prepared to provide comprehensive disclosures with accurate quantitative data, adhering to recognized frameworks and third-party verification [1][2] - 41% of large companies are inadequately prepared for new ESG disclosure regulations, raising concerns about vague disclosures and insufficient information, especially in risk management and climate goals [1][2] Green Finance Developments - Ten large Hang Seng Index companies reported green financing exceeding HKD 50 billion in 2024, a 20% increase from the previous year, indicating rapid maturation in Hong Kong's sustainable finance sector [3] - 39% of large companies mentioned green finance tools in their ESG reports, a 3% increase year-on-year [3] - 78% of green finance issuance in 2024 exceeded HKD 10 billion, reflecting a growing market momentum and the importance of sustainable capital allocation in high-carbon, capital-intensive industries [4] Technology and Data Management - Over half (58%) of large Hang Seng Index companies reported deploying or planning to deploy AI technology to enhance the accuracy of ESG data collection and reporting [1][5] - 92% of companies emphasized cybersecurity in their ESG reports, a significant 10% increase from 2023 [5] - Only 69% of companies disclosed AI-related training or IT skill enhancement plans, highlighting a significant gap in aligning AI applications with emerging global standards [5][6] Future Outlook and Recommendations - Companies are urged to shift focus from the quantity of ESG reporting to the quality, including investing in robust data systems and independent verification [6] - The upcoming mandatory climate disclosure regulations necessitate that Hong Kong listed companies accelerate their ESG transformation efforts [6]