New Hong Kong fund rules collide with China’s poor ESG data

Under proposed rules, funds will need climate risk data from investee firms, many of them Chinese

Hong Kong asset managers fear that under rules proposed by the territory’s securities regulator, they will face a next-to-impossible task: disclosing their portfolios’ exposures to climate risk without knowing the climate performance of many companies in those portfolios.

Funds point the finger at the poor quality of environmental, social and governance (ESG) reporting by companies in mainland China, which is a major investment target for Hong Kong’s asset managers.

“Carbon emissions data is