Local businesses 'dragging heels over global warming'

Report shows alarmingly few local businesses publish carbon footprint reports, making it harder for city to deal with global warming

PUBLISHED : Thursday, 12 December, 2013, 5:54am
UPDATED : Thursday, 12 December, 2013, 6:29pm

Fewer than one in 10 companies listed on the Hang Seng Composite Index publish reports on their carbon footprints, in a "worrying" sign of a business sector dragging its heels over global warming, a consultancy says.

This made it harder for companies to develop proper strategies to tackle carbon emissions, said Carbon Care Asia, the climate change and carbon strategy consultancy behind the report.

The problem was particularly acute among small firms, which were largely unaware of their carbon footprints, the report said.

It found local businesses moving too slowly in responding to climate change compared with rivals in Singapore.

"Hong Kong needs to take bold action to tackle the climate change challenge," the firm's chief executive Albert Lai Kwong-tak said. "If the business sector is slow to act, everyone in Hong Kong will suffer."

The consultancy issued the city's first carbon performance report on local businesses.

Researchers studied a random sample of 216 listed companies from HSCI indices based on market-capitalisation size.

Just 26 companies had issued formal reports on their carbon emissions, with only five having set clear targets on reduction.

Lai said publishing such reports was a first step towards building a low-carbon economy, but firms in the city were doing so only at a preliminary level.

"This is a wake-up call for company executives," he said.

A quarter of large-capitalisation (LargeCap) companies disclosed their carbon emissions, compared with just 3 per cent of small-capitalisation firms, the report noted. That suggested large companies fared better in carbon reporting, though not always in quality, it said.

LargeCap firms that report on their carbon emissions include CLP, HSBC, Swire and Li & Fung. The MidCaps include Hopewell, China Everbright and Shui On Land, while the SmallCaps comprise just ZTE and Pacific Basin Shipping.

"Fewer than 1 per cent of local companies reported carbon emissions in accordance with international guidelines such as the Global Reporting Initiative," Lai said, referring to the Netherlands-based non-profit initiative that sets out guidelines and standards for sustainability and ecological reporting.

At least 3 per cent of Singaporean firms follow those guidelines.

"We hope more Hong Kong companies will catch up with world best practices," Carbon Care Asia chairman Chong Chan-yau said.

Things are already changing. The Hong Kong Exchanges and Clearing is upgrading listing guidelines on environmental reporting from a "voluntary" basis to a stricter "comply or explain" model beginning in 2015.

The Environmental Protection Department said there was no legal requirement for companies to issue carbon reports, but it encouraged all companies, listed or not, to follow responsible practices such as carbon reporting and auditing.