As Asia continues its rapid economic growth, the region faces the dual challenge of sustaining development while addressing the escalating impacts of climate change. Transition finance has become a crucial mechanism to guide high-emission industries toward a low-carbon future. However, realizing its full potential requires collaborative efforts to enhance capacity across financial systems, institutions, and stakeholders, fostering meaningful and sustainable transformation.
To support these efforts, the Capacity-building Alliance of Sustainable Investment (CASI) will host a one-day forum during Hong Kong's Green Week in September. This forum provides a pivotal platform for advancing capacity-building on sustainable and transition finance across Asia. Building on last year's success, CASI will convene regional and international experts to address the urgent need for knowledge-sharing, skills development, and institutional strengthening.
Co-hosted by CASI, the Hong Kong Monetary Authority Infrastructure Financing Facilitation Office (HKMA-IFFO), the HKU Jockey Club Enterprise Sustainability Global Research Institute (HKUJC ESGRI), and the CFA Institute, the forum will also be supported by a range of key organizations. This forum will feature keynote speeches, panel discussions, and interactive sessions on topics such as transition taxonomies, planning, GHG disclosure, and financial product innovation. It will also emphasize transparency and accountability in achieving sustainable outcomes.
This event will offer critical insights into emerging trends, strategies, and financial tools for Asia's low-carbon transition, including in some of the hard-to-abate sectors like fossil fuels, steel, cement, shipping, and agriculture, demonstrating Hong Kong's leadership as a green finance hub.
Why You Should Attend:
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Under the urgent call for climate change actions and carbon neutrality, carbon-intensive industries are facing more and more strict regulatory requirements, rising investor expectation, and increasing exposure to transitional risks. Companies in these sectors are encouraged to develop transparent and credible transition plans that shall outline efforts and efforts to mitigate climate change risks, and to integrate it into the long-term business strategies. Financial firms on the other hand are also facing similar pressure to develop their portfolio level transition plans. However, the current gaps in transition finance and capacity, especially among the SMEs, highlight the need for collaboration and support from all stakeholders, including regulators, FIs, corporates, and civil society.
This session will go through the key challenges in designing and implementing transition plans for carbon-intensive industries and financial firms particularly within the Asian context. A moderated panel with professionals and practitioner in the fields will offer practical insights.
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Against the backdrop of climate transition, innovative financial instruments are essential for financial institutions to better support the decarbonization of their clients and for corporates to attract investment and to fill in the large financing gap for the low-carbon transition. Products like sustainability-linked loans (SLLs) and bonds (SLBs) have experienced significant growth in recent years and labeled transition bonds have also seen steady growth, especially for sovereign issuances. However, current market growth is still not comparable with the green and sustainable finance markets. Smaller firms, especially MSMEs, are not able to develop and implement a full-fledged transition plan for up to 30 or 40 years. A simplified approach and backward-looking transition finance product might be better used to support these firms’ transition needs.
To further explore innovations in transition finance instruments, a panel with experts and practitioners will focus on the main challenges of current transition products with specific industrial or regional context. The discussion will also address how to harmonize the international standards and channels to facilitate the interconnection between markets and between key stakeholders.
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Robust disclosure and transparency are among the most fundamental pillars for the sustainable finance market, which is even more so for transition finance. In 2022, the G20 published Transition Finance Framework, which consists of 22 principles across 5 pillars. Pillar 2 emphasizes on the transparent disclosure of information on transition activities, including transition plans, climate data, governance structures, performance targets, assessment methodologies. Regional regulators have also made to improve the quality and accountability of transition-related disclosure through various guidelines, plans, and initiatives.
This session will provide an overview of transition disclosure requirements and implementation, and discuss how the key stakeholders, like regulators, financial institutions, and enterprises, can better navigate the regulatory requirements to efficiently support the low-carbon transition. Key issues like the integration with existing disclosure framework, data availability, standard harmonization, and enforcement mechanisms will be further discussed in the panel.
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