November deadline for compliance with the SFC’s climate-related risks requirements

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Authored by: Joyce Li

Type 9 licensed corporations (LCs) with investment management discretion in respect of collective investment schemes (funds) will soon be required to comply with the Securities and Futures Commission’s (SFC’s) new climate-related risks requirements. The SFC has adopted a two-tier approach, whereby all in-scope LCs must comply with the baseline requirements. In-scope LCs that qualify as large fund managers (i.e. LCs with funds under discretionary management equal to or in excess of HK$8 billion) are required to comply with enhanced standards in addition to the baseline requirements.

Large fund managers have until 20 November 2022 to comply with the enhanced standards. The deadline for large fund managers to comply with the baseline requirements was 20 August 2022. Other in-scope LCs must comply with the baseline requirements by 20 November 2022.

We have linked below the key SFC materials plus two bulletins by Deacons which describe the regime and the steps that LCs should be taking towards compliance.

Key materials:

• Consultation Conclusions on the Management and Disclosure of Climate-related Risks by Fund Managers (SFC, 20 August 2021)

• Amendments to the Fund Manager Code of Conduct – set out in Appendices B and C of the above

• Circular (SFC, 20 August 2021) with Appendix 1 and Appendix 2

• FAQs (SFC, 20 August 2021)

• Climate-related risk requirements for fund managers (Deacons, 30 August 2021)
• Unpacking the SFC’s requirements on the management and disclosure of climate-related risks for fund managers (Deacons, 26 October 2021)

Key Contacts

Joyce Li

Partner | Financial Services

Email or call +852 2825 9318