HKFRS S1 and HKFRS S2 – Hong Kong Sustainability Disclosure Standards

HKEX listing rules require all Main Board issuers to disclose climate information aligned with IFRS S2 on a comply-or-explain basis from 1 January 2025, with mandatory application for Hang Seng Composite LargeCap constituents from 1 January 2026. Some elements differ from IFRS S2 (e.g., scope of consolidation, industry-based metrics).

Enforcement

Scope 1 and 2 GHG emissions mandatory for all listed issuers (Main Board and GEM) from FY2025. Other climate requirements (Part D of the ESG Code) on a comply-or-explain basis for all Main Board issuers from FY2025 and voluntary for GEM issuers. Mandatory for Hang Seng Composite LargeCap Index constituents from FY2026.

Effective date

Financial years commencing on or after 1 January 2025 (Scope 1 and 2 mandatory for all issuers; comply-or-explain for Main Board); financial years commencing on or after 1 January 2026 (mandatory for HSCI LargeCap constituents)

Covered entities

All HKEX-listed issuers (Scope 1 and 2); all Main Board issuers (comply-or-explain on other climate requirements); HSCI LargeCap constituents (mandatory); GEM issuers encouraged to report other climate requirements voluntarily

Hong Kong's Product Eco-responsibility Ordinance is umbrella legislation under which EPD has rolled out three Producer Responsibility Schemes covering plastic shopping bags (2009), waste electrical and electronic equipment (2018, enhanced 2024) and glass beverage containers (2023). Suppliers pay levies that fund WEEE Park and licensed glass and plastic recyclers.

Enforcement

Mandatory

Effective date

PERO enacted July 2008; Plastic Shopping Bag Charging Scheme effective 7 July 2009 (full coverage 1 April 2015 and charge raised 31 December 2022); WEEE PRS effective 1 August 2018, enhanced scope from 1 July 2024; Glass PRS phased in first half 2023; Miscellaneous Amendments Bill 2025 passed by LegCo 23 July 2025

Covered entities

Suppliers and sellers of regulated electrical equipment (8 categories pre-2024, all EEE from July 2024), retailers selling plastic shopping bags, and suppliers of glass beverage containers placed on the Hong Kong market

Australia has adopted ISSB-aligned sustainability standards. AASB S2 (climate) is mandatory for entities within Chapter 2M of the Corporations Act and is phased in across three groups from 2025 to 2027. AASB S1 (general sustainability) is voluntary. ASIC administers the regime and has published guidance in RG 280.

Enforcement

AASB S1: voluntary. AASB S2: mandatory under Corporations Act 2001 for in-scope entities.

Effective date

Financial years beginning on or after 1 January 2025 (Group 1), 1 July 2026 (Group 2) and 1 July 2027 (Group 3). AASB S2025-1 amendments apply to annual periods beginning on or after 1 January 2027, with early application permitted.

Covered entities

Entities that must prepare annual financial reports under Chapter 2M of the Corporations Act and meet a s292A threshold. Group 1: at least two of consolidated revenue of AUD 500m or more, consolidated gross assets of AUD 1bn or more, and 500 or more employees; or NGER registered corporations in groups that meet the s13(1)(a) NGER threshold. Group 2: at least two of revenue of AUD 200m or more, assets of AUD 500m or more, and 250 or more employees; all other NGER registered corporations; and registered schemes, RSEs and retail CCIVs with assets of AUD 5bn or more. Group 3: at least two of revenue of AUD 50m or more, assets of AUD 25m or more, and 100 or more employees.

UK SRS S1 and S2 are the UK government's endorsed versions of IFRS S1 and S2, published on 25 February 2026 for voluntary use. Voluntary users can apply the Scope 3 and non-climate reliefs with no time limit. The FCA has consulted on listing rules that would make UK SRS S2 climate reporting mandatory for listed companies, with Scope 3 emissions and UK SRS S1 non-climate reporting on a comply-or-explain basis.

Enforcement

Voluntary at publication. FCA proposes mandatory UK SRS S2 for listed issuers (Scope 3 and broader sustainability on comply-or-explain).

Effective date

Voluntary use: no effective date (entities apply the standards when they choose). FCA proposal, subject to the final policy statement: rules in force 1 January 2027 for accounting periods beginning on or after 1 January 2027; using the transitional reliefs, Scope 3 reporting from periods beginning on or after 1 January 2028 and UK SRS S1 non-climate reporting from periods beginning on or after 1 January 2029.

Covered entities

Any entity (voluntary). The FCA proposal covers issuers in the commercial companies (UKLR 6), non-equity and non-voting equity shares (UKLR 16), transition (UKLR 22), secondary listing (UKLR 14) and depositary receipts (UKLR 15) categories. No mandate yet for unlisted companies.

CSSB issued final CSDS 1 and CSDS 2 on 18 December 2024, aligned with IFRS S1 and S2 with extra transition reliefs. The standards are voluntary. The CSA paused its mandatory climate disclosure rulemaking on 23 April 2025. In April 2026 the CSSB proposed CSDS 2 amendments matching the ISSB's IFRS S2 amendments: limiting Scope 3 Category 15 to financed emissions, allowing an industry classification other than GICS, and allowing other GHG measurement methods or GWP values where a jurisdictional authority or exchange requires them.

Enforcement

Voluntary

Effective date

Standards effective for annual reporting periods beginning on or after 1 January 2025, for entities that choose to apply them (with transition reliefs). Voluntary; no mandatory reporting date exists.

Covered entities

Any Canadian entity (voluntary). CSA paused work on mandatory rule citing global developments.

SSBJ published its Application, General and Climate Standards on 5 March 2025, and the SSBJ and ISSB confirm they are functionally aligned with IFRS S1 and S2. The FSA amended the Cabinet Office Order on Disclosure of Corporate Affairs on 20 February 2026 to require SSBJ-based disclosures in Annual Securities Reports for large Prime Market companies from the fiscal year ending March 2027, with third-party assurance one year later.

Enforcement

Mandatory for Tokyo Stock Exchange Prime Market companies, phased by market cap, through Annual Securities Reports under the Cabinet Office Order on Disclosure of Corporate Affairs. Voluntary for other entities.

Effective date

Voluntary for annual periods ending on or after 5 March 2025. Mandatory for Prime Market companies by average market cap (average of the last five fiscal year-ends): ¥3 trillion or more from the fiscal year ending March 2027; ¥1 trillion or more from the fiscal year ending March 2028; ¥500 billion or more from the fiscal year ending March 2029. Timing for other Prime Market companies to be decided later. Mandatory assurance starts one year after each cohort's first mandatory year.

Covered entities

Tokyo Stock Exchange Prime Market companies with average market capitalization of ¥500 billion or more, in three cohorts (¥3 trillion, ¥1 trillion, ¥500 billion). Timing for other Prime Market companies not yet set.