Hong Kong rated as leading sustainable business hub

February 24, 2025 at 04:13 AM EST

HONG KONG, Feb 24, 2025 - (ACN Newswire) - Hong Kong has been globally recognised as taking a lead in sustainable business development. This is the key finding from the preliminary edition of the HKTDC ESG Index, an important new metric introduced by the Hong Kong Trade Development Council (HKTDC) with the aim of ensuring local, Mainland China and global enterprises have an in-depth understanding of the city’s strengths as an ESG (environmental, social and governance) business hub.

The index is based on an analysis of how businesses perceive Hong Kong’s strengths across the three established ESG criteria: environmental, social and governance. The initial research factored in the views of more than 1,200 businesses through surveys conducted by the HKTDC at many of its most high-profile trade fairs and related business events in 2024.

Explaining the rationale behind the launch of the new index and its ongoing significance for Hong Kong, Irina Fan, Director of HKTDC Research, said: “This new metric has been devised to help domestic and global businesses gauge the efficacy of Hong Kong as a platform for sourcing ESG-related products and services, as well as identifying more ESG-responsible counterparts. We believe the index will significantly contribute to the overall understanding of the business world’s prioritisation of sustainable operational models and the real and lasting contribution Hong Kong is making to this shift at a global, regional and local level.”

Overall, Hong Kong scored highly in the index across all three criteria, receiving an aggregated total of 64.3 points. This figure is well above the neutral watershed point of 50 and indicates the city’s status as an effective and highly regarded global ESG business hub.

Hong Kong rates highly across all criteria as an ESG hub

This high score was reflected in the marks accorded to each criterion – Environmental (63,8), Social (65.0), and Governance (64.7). Across these categories, respondents from the three designated geographical regions all had distinct individual preferences and their own specific reasons for awarding the city such high marks.

In the case of Hong Kong’s Environmental credentials, respondents from the mainland (68.6) saw Hong Kong’s strengths as lying primarily in its provision of green and sustainable investment opportunities. International enterprises (67.2), meanwhile, had a particularly high regard for the availability and diversity of green and sustainable solutions, while local businesses rated the quality and innovation of the city’s portfolio of green and sustainable products and services most highly.

Regarding the Social Sub-Index, it was Hong Kong’s ESG-related expertise and talents that most impressed mainland survey respondents, followed by the city’s success in promoting cross-border ESG knowledge exchange. International and Hong Kong-based respondents highly rated the engagement of local businesses in community development and social welfare programmes, as well as the ability to find socially responsible business partners.

For the Governance Sub-Index, Hong Kong’s proficiency in facilitating effective ESG-oriented international collaborations, particularly with regard to international standard-setting and the provision of market access, was highly valued by all participants regardless of location. Mainland respondents also singled out the effectiveness of Hong Kong’s ESG reporting frameworks and regulations.

Commercial advantages of ESG engagement

In addition to its core focus on the views of buyers and vendors regarding the efficacy of Hong Kong as an ESG hub, the research also set out to provide insights into other developmental aspects of ESG-related business. Among the key findings here were:

All buyers currently sourcing ESG-related products or services indicated they were willing to pay a higher premium for such products or services. Some 68% of them were willing to pay a premium of at least 10% to secure such items. This is largely because prioritising ESG-friendly solutions is seen as likely to enhance a company’s brand reputation and corporate image while ensuring compliance with all relevant regulatory requirements and risk-management protocols.All vendors currently providing ESG-related products or services maintained they earned additional profit margins from such products or services. Approximately 72% of them reported that the additional profit margins delivered by such activities were 10% or higher than those related to comparable non-ESG-compliant products and services. In addition, by meeting market demand for ESG-related products and services, such vendors also saw themselves as positively differentiated from their competitors and, consequently, gaining a commercial advantage.Nearly 90% of respondents see ESG considerations as an integral element of their overall business decision-making process, underscoring the general acceptance of the importance of such principles.

Methodology

The provisional findings of this initial edition of the HKTDC ESG Index were drawn from a survey of 1,200+ vendors or buyers in attendance at seven HKTDC trade fairs and business events from April to December 2024. The survey will be completed in March and the first full edition of the index will be released thereafter. Full details of the methodology used for the survey can be found in the Appendix to the Preliminary Report.

Photo download: https://bit.ly/4hbnJbj

(from left) HKTDC Director of Research Irina Fan, Principal Economist (Global Research Team) Alice Tsang, Economist Edmund Lo and Senior Economist Nicholas Fu announced the preliminary edition of the HKTDC ESG Index at a press conference today.

HKTDC Director of Research Irina Fan

HKTDC Principal Economist (Global Research Team) Alice Tsang

HKTDC Senior Economist Nicholas Fu

HKTDC Economist Edmund Lo

Media enquiries

Please contact the HKTDC’s Communication and Public Affairs Department:

Jane Cheung Tel: (852) 2584 4137 Email: jane.mh.cheung.hktdc.org
Johnny Tsui Tel: (852) 2584 4395 Email: johnny.cy.tsui@hktdc.org

About HKTDC

The Hong Kong Trade Development Council (HKTDC) is a statutory body established in 1966 to promote, assist and develop Hong Kong's trade. With over 50 offices globally, including 13 in Mainland China, the HKTDC promotes Hong Kong as a two-way global investment and business hub. The HKTDC organises international exhibitions, conferences and business missions to create business opportunities for companies, particularly small and medium-sized enterprises (SMEs), in the mainland and international markets. The HKTDC also provides up-to-date market insights and product information via research reports and digital news channels. For more information, please visit: www.hktdc.com/aboutus.

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Hong Kong rated as leading sustainable business hub

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