HKMA Announces Sustainable Finance Initiative at COP26
The Hong Kong Monetary Authority (HKMA) announced that the Green and Sustainable Finance Cross-Agency Steering Group reaffirms its commitment to strengthening the financial ecosystem for a more sustainable future and reiterates its support for the Climate Action Plan 2050 of the government of Hong Kong. The Steering Group welcomed publication by the IFRS Foundation of the prototype for the climate disclosure standard, the publication of Common Ground Taxonomy report by the International Platform on Sustainable Finance (IPSF), and the global advances in building a worldwide carbon market. HKMA also announced that in partnership with the International Finance Corporation (IFC) and another institutional investor it will work to create a new USD 3 billion global platform for climate-smart investment aligned with the Paris Agreement.
The new program, Managed Co-Lending Portfolio Program (MCPP) One Planet, combines institutional investor contributions with IFC’s own funds to scale up climate-responsible financing for private companies in emerging markets. MCPP One Planet will create the world’s first cross-sectoral portfolio of emerging-market loans aligned with the Paris Agreement. The facility enables institutional investors to directly provide capital for sustainable lending in emerging markets, allowing investors to scale up their exposure to this asset class and increase the share of their portfolios aimed at climate-resilient development. MCPP One Planet builds on successful collaboration between IFC and its partners and will mark a further scale-up of IFC’s innovative MCPP private debt platform. Since its launch in 2013, MCPP has raised over USD 10 billion from 11 investors and provided financing to more than 200 firms across 55 developing countries. The IFC Managing Director Mr Makhtar Diop announced MCPP One Planet at COP26 and said that MCPP One Planet will create a global model for mobilization of institutional investor financing in support of the climate agenda for the most vulnerable communities on the frontlines of climate change—in emerging and developing economies. Joining hands with IFC is expected to allow HKMA to tap into the considerable expertise, experience, and network of IFC in sourcing investable and climate-responsible opportunities within proper risk management and governance framework.
Keywords: Asia Pacific, Hong Kong, Banking, Securities, Climate Change Risk, ESG, Sustainable Finance Disclosures, Climate Action Plan, MCPP One Planet, COP 26, IFRS, HKMA
Featured Experts
Michael Denton, PhD, PE
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
James Partridge
Credit analytics expert helping clients understand, develop, and implement credit models for origination, monitoring, and regulatory reporting.
Previous Article
ECB Publishes Selected Pillar 3 Information for 2020 Reference DateRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
