The Hong Kong Monetary Authority (HKMA) has issued a set of principles guiding banks on the transition to a net zero economy.
The focus of these principles is on setting clear targets and objectives aligned with a net zero transition and the Paris Agreement’s goals. The agreement aims to keep the rise in global temperatures well below 2°C, ideally at 1.5°C.
The HKMA’s directive also touches on integrating these transition considerations into banks’ internal processes such as governance, accountability, and risk management. This integration also extends to banks’ business strategies, products, services, and client engagements.
Additionally, HKMA is urging banks to boost the transparency of their net-zero transition planning processes and be agile in updating their plans as climate scenarios change.
HKMA’s Executive Director of Banking Policy Daryl Ho said, “The HKMA recognises that international practices and discussions on transition planning and transition plans are still evolving. Nevertheless, given the increasing focus on the subject and in the light of the HKMA’s two-year plan, we consider it useful to set out some high-level principles to assist authorized institutions (AIs) in planning for a net-zero transition.”
The HKMA recently revealed it is aiming to make Hong Kong a leading FinTech hub through a 12-month road map.
This strategic initiative is designed to inspire investment in technology across a spectrum of financial services including wealth management, insurance, and green finance.
Keep up with all the latest FinTech news here.
Copyright © 2023 FinTech Global
