In line with the global sustainable development trend and to consolidate Hong Kong's position as an international logistics hub, the Hong Kong Transport and Logistics Bureau released the "Logistics ESG Development Roadmap" on June 18. The three-year roadmap focuses on small and medium-sized logistics companies and aims to improve their environmental, social and governance (ESG) performance in response to increasingly stringent international regulations, especially the EU's supply chain ESG disclosure requirements that are about to be fully implemented.

(Image source: "Logistics ESG Development Roadmap")

In recent years, global ESG regulation has become increasingly stringent. The EU has passed the Corporate Sustainability Reporting Directive (CSRD), requiring large companies to disclose ESG information on their entire supply chain, including "scope three emissions" data (i.e. indirect carbon emissions from upstream and downstream). At the same time, mainland China also plans to fully implement corporate sustainable disclosure standards by 2030, covering small and medium-sized enterprises.

As an open economy that is highly dependent on international supply chains, Hong Kong's logistics industry (especially SMEs) has received high attention for its ESG compliance capabilities. In 2023, the Chinese and European markets, as well as the US market where many companies have added ESG compliance requirements to their procurement contracts, will account for 60% of Hong Kong's total merchandise trade.

The roadmap released this time adopts a three-stage promotion model, covering 2025 to 2027, with the goal of enhancing the ESG awareness and practical capabilities of logistics SMEs within a limited time.

Phase (I): Establish ESG awareness

The goal of SMEs: to understand the main international ESG requirements, the basic principles of ESG, and its value to the logistics industry.

Phase (II): Develop a logistics ESG data framework and cultivate data collection capabilities

The goal of SMEs: to be able to master the important data items related to logistics ESG reporting; and have the ability to effectively collect and record logistics ESG data.

Phase (III): Improve logistics ESG data recording capabilities

The goal of SMEs: to improve the ability to prepare and evaluate sustainable development reports and seize green transformation opportunities.

To support the implementation of the roadmap, the government is also promoting a number of support measures, including:

● Pilot scheme for third-party logistics service providers: The maximum funding is HK$2 million, supporting ESG technology solutions.

● Professional training scheme for smart and green logistics: 80% tuition subsidy for eligible training courses.

● Logistics promotion subsidy scheme: Support industry organizations to carry out ESG publicity, seminars, etc.

The government also plans to cooperate with the Hong Kong Logistics Development Council, industry associations, universities, etc. to strengthen knowledge sharing, experience exchange and publicity and education, so as to encourage more SMEs to "keep up with the ESG train".

The roadmap emphasizes that ESG is not just a one-time compliance task, but should be a tool for enterprises to improve their performance in the long term. Through data collection, analysis, benchmarking and adjustment, enterprises can gradually establish an operating culture consistent with sustainable development goals.

In addition, the Transport and Logistics Bureau stated that it will evaluate the implementation of the roadmap in 2027 and update the content according to the latest international standards. In the future, it may explore the establishment of an "ESG data book" and the introduction of a third-party certification mechanism to promote the industry to further align with international standards.

Author：Qinger