HKEX to launch green financing portal in move to build a leading role amid regional competition
- Green bond issuers can promote their products on the portal for free, update their efforts to tackle ESG-related
- Guangzhou will start a carbon emission futures exchange as part of China’s blueprint for Greater Bay Area
The portal called STAGE will come into operations later this year to allow companies to promote their green bonds or other investment products that comply with environmental, social and governance (ESG) standards, without any charges.
Issuers, however, must list their products on the Hong Kong exchange and pay the listing fee, HKEX said. They are also required to provide regular updates on the portal to investors on how they spend the listing proceeds and progress on tackling ESG-related issues.
HKEX chairperson Laura Cha Shih May-lung said the new platform would help initiate conversations between issuers and investors on green financing.
“As the global markets leader in the Asian time zone, HKEX has a powerful platform to affect change,” she said in a statement. “It is our job at HKEX to lead by example, and encourage stakeholders to play an active role in the development of Hong Kong’s sustainable and green finance ecosystem.”
Under its 2019-2021 development plan, HKEX wants to stake a leading role in green financing in the region, just as the neighbouring mainland city of Guangzhou is preparing to start a climate futures exchange. China itself is touting the Greater Bay Area, a cluster of nine Chinese cities with Macau and Hong Kong, as a hub for similar initiative.
China last month indicated that Guangzhou would host a new futures exchange for carbon emission futures and other green products. However, no definite timeplan for the project has been disclosed.
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‘Green financing is growing rapidly worldwide, so it is natural for HKEX to develop a platform to promote such offerings in Hong Kong,” said Jeffrey Chan Lap-tak, a founding partner of Oriental Patron Financial Group.
Besides green bonds, HKEX is also keen to attract the listing of international stocks, or index-tracking exchange-traded products, that focus on climate change or ESG-related issues, said Grace Hui, head of green and sustainable finance at HKEX.
There were 44 listed green bonds with a combined face value of US$20.9 billion (HK$163 billion) at the end of May, based on exchange data. They increased from HK$75 billion in 2019 and HK$2.4 billion five years ago.
Green financing issues surged to record US$18.9 billion in Asia-Pacific last year, with mainland China accounting for 43 per cent of them while Hong Kong’s share was 13 per cent, it added.
