Environmental disclosure rules tighten for Chinese companies

Update comes as Hong Kong announces plan to launch pilot for climate transition plans

Companies in China have been given until the end of the financial year to sharpen their disclosures on pollution, water and energy. 

Stock exchanges in Shenzhen, Shanghai and Beijing have updated their shared ESG reporting framework, which applies to around 460 issuers, including those listed on the SZSE 100, SSE 180, STAR 50 and the ChiNext Index. 

Other listed companies that want to publish reports with ‘ESG’ or ‘sustainability’ in the title also have to comply with the guidance.  

The original guidelines were published at the start of 2025, and updated at the end of January to include chapters on “pollutant discharge”, “energy utilisation” and “water resources utilisation”.  

Each new section provides updated expectations, as well as detailed explanations of common risks and opportunities associated with the topic, and guidance on calculating data. 

The Chinese government published a pilot corporate climate reporting standard in December, which is based on the International Sustainability Standard Board’s IFRS 2. 

For now, the standard is voluntary, but a timeline and scope for a mandatory regime is expected to be announced in due course.

This week also saw the announcement of a pilot on climate transition plans in Hong Kong. 

An advisory committee co-chaired by the Hong Kong Monetary Authority and the Securities and Futures Commission said the project was one of its strategic priorities under the next phase of its sustainable finance agenda.    

It aims to work with listed companies in Hong Kong to promote “industry-developed best practices” and “produce investor-focused and decision-useful transition plans aligned with internationally recognised frameworks”.