AVISTA Provided Feedback on Exposure Drafts for HKFRS S1 and S2 Released by HKICPA

On September 16, 2024, the Hong Kong Institute of Certified Public Accountants ("HKICPA") issued Exposure Drafts for HKFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information and HKFRS S2 Climate-related Disclosures, seeking market comments. The HKICPA has proposed full convergence of HKFRS S1 and S2 (HKFRS Sustainability Disclosure Standards) with the IFRS S1 and S2 standards set by the International Sustainability Standards Board (ISSB), effective from August 1, 2025.

 

The application of HKFRS S1 and S2 will remain voluntary until mandated by relevant authorities, with publicly accountable entities (PAEs), including listed companies and regulated financial institutions in Hong Kong, prioritized for implementation. As outlined in FAQ 1 of the explanatory memorandum accompanying the Exposure Drafts (addressing "Which entities must apply the HK Standards and by when?"), relevant authorities/regulators authorities, including HKEX, HKMA, SFC, MPFA, and IA, will conduct their consultations soon to determine the approach and timeline for adopting HKFRS S1 and S2. Entities required to prepare sustainability disclosures will continue to follow the regulations, guidelines, or rules specified by these authorities.  Until further decisions are made by the relevant authorities/regulators, entities preparing sustainability disclosures have the sole discretion to decide whether sustainability disclosures should be prepared in accordance with the HK Standards or other frameworks.

 

This alignment is crucial for Hong Kong as a global financial center, facilitating the integration of global capital with local businesses in Hong Kong, mainland China, and beyond.

 

AVISTA Group has submitted comments on the Exposure Drafts, including feedback on the proposal to fully align HKFRS S1 and S2 with IFRS S1 and S2, along with other relevant comments. We are committed to actively contributing to the enhancement and advancement of the industry market, leveraging our expertise, experience, and dedication to excellence to drive positive change and progress within the industry.

 

For further information, please refer to the exposure drafts document: https://www.hkicpa.org.hk/en/Standards-setting/Standards/Open-for-comment-documents/Sustainability-Reporting