Hong Kong's Services Sector: Pioneering the Path to a Greener Future

With sustainable development being one of today's key topics around the world, Hong Kong is playing an active role in climate-related initiatives and has set up a number of carbon-reduction targets to achieve carbon neutrality by 2050. Within this transformation process, the services sector, though not regarded as a major CO2 emitter, shares responsibility for utilising its expertise to promote sustainable development and lead by example. In doing so, organisations in the services sector can help address climate change. HSBC recently organised a sustainability roundtable for the services sector, which gathered experts from different sub-sectors to share insights on how the services sector can embark on its sustainable transformation journey.

The services sector could have a strong impact on driving 'net zero' carbon emissions and achieving carbon neutrality.

Bernard FUNG Tak-kei, Head of Property Division of Tung Wah Group of Hospitals (TWGHs), mentioned at the seminar that TWGHs is currently building an E-co Village on the restored landfill site in Tseung Kwan O. The E-co Village is envisioned to include a number of campsites, community farms, butterfly gardens, a children's green education zone and an amphitheatre, which will serve as an important base for carbon neutrality and environmental education in Hong Kong. Organisations within the education sector can play a role in nurturing the next generation by equipping them with sustainability awareness and skills, helping to lay a solid foundation for the sustainable development of our society in the future.

In recent years, Tung Wah College has launched an undergraduate programme. The course curriculum integrates social policy analysis, business elements, social enterprise operation and design thinking to empower the new generation with the relevant skills for becoming social entrepreneurs, such as developing the knowledge and judgement required to balance the interests of enterprises and communities.

According to the Architectural Services Department, electricity consumption in buildings accounts for about 90% of the total electricity consumption in Hong Kong and generates over 60% of the city's carbon emissions¹. Reducing carbon emissions and accelerating the green transformation of buildings in the city is therefore crucial to achieving Hong Kong's carbon neutrality target by 2050.

MK Leung, Director of Sustainable Design at Ronald Lu & Partners, believes that practices such as using energy-efficient design and renewable energy, adopting green building materials, and implementing innovative waste-management strategies, coupled with collaboration between the public and private sectors, can drive the low-carbon transition and reduce the carbon footprint of Hong Kong's built environment.

Undergoing a sustainable transformation requires human resources and financial investment, which may pose a challenge for enterprises. Hence, Ir Stephen Chow, Head of Carbon and ESG Solutions at the Hong Kong Productivity Council (HKPC), suggests that companies should make use of government and other resources.

Currently, the HKPC offers a full range of consultancy services and a free online ESG self-assessment to help companies understand and enhance their ESG performance². Other services include helping companies collect and analyse data to develop ESG reports that fulfil the HKEx requirements, as well as providing advice and plans for goal-setting and conducting sustainability training.

Meanwhile, the Financial Services and the Treasury Bureau of Hong Kong have stepped up their efforts to support the development of green and sustainable finance³. The aim is to encourage more organisations to leverage Hong Kong's capital market advantage as well as its capital and professional services to launch green and sustainable financing and certification. The Government established the Government Sustainable Bond Programme (GSBP) in 2018 with an initial borrowing ceiling of HKD100 billion. Subsequently, in the 2024-25 Budget, it was announced that the combined borrowing ceiling for the GSBP and the Infrastructure Bond Programme, which was established in May 2024, would be set at HKD500 billion to provide greater flexibility in quota re-allocation.

To further enrich the green and sustainable financial ecosystem in Hong Kong, the Government launched a three-year Green and Sustainable Finance Grant Scheme in May 2021 to subsidise some of the issuance expenses of eligible bond issuers and borrowers, as well as the cost of using external vetting services, which further facilitates green and sustainable bond issuance and lending activities. The programme has now been extended for another three years to 2027, and the scope of the funding has been expanded to cover transformational bonds and loans.

To support Hong Kong's commitment to achieving carbon neutrality by 2050, HSBC offers a wide range of sustainability solutions for businesses. For example, we provide social loans to different entities, including non-profit organisations and charities for eligible projects, such as healthcare and education services. HSBC has also launched the Sustainability Improvement Loan for businesses in early stages of their sustainability journeys. The solution links the cost of financing to a business's sustainability performance.