The Hong Kong Monetary Authority requires trustees to enhance disclosure on funds related to ESG themes.

The Hong Kong Mandatory Provident Fund Schemes Authority (MPFA) issued a latest circular to trustees today, requiring trustees to enhance disclosure of ESG-themed funds. It is mandatory to disclose the ESG focus and investment strategy of funds in the Trillions of MPF scheme explanatory booklet. In addition, trustees are also required to disclose the mechanism for monitoring whether the funds meet the set ESG targets, and to periodically assess the degree to which the funds achieve the set ESG objectives. Susanna Chiang, Executive Director of MPFA (Member and Supervisor), stated that this new arrangement directly affects the current 5 Trillions of MPF funds with ESG, green, or sustainable names for scheme members. Regarding the disclosure of the ESG focus of funds in the Trillions of MPF scheme explanatory booklet under the new arrangement, Susanna Chiang explained that it needs to cover the following 5 categories: describing ESG investment focus or themes, describing the fund's investment strategy, expected asset allocation ratio for investment focus, ESG-related risk limits, and relevant benchmarks.