HKFRS S2 - Hong Kong Financial Reporting Standard S2 - Climate-related Disclosures

HKFRS S2 raises the bar for climate-related disclosures by moving beyond broad sustainability statements to decision-useful information for capital markets.

It emphasises how climate risks and opportunities affect an entity’s strategy, business model, cash flows, and resilience under different climate scenarios.

The standard also pushes for stronger connectivity between sustainability reporting and financial statements, including clearer links to assumptions, estimates, and risk management processes.

For preparers, the main challenge is data readiness: establishing governance, controls, and metrics that can stand up to assurance.

For investors and boards, HKFRS S2 improves comparability and accountability by standardising what “good” climate disclosure looks like, helping assess exposure, transition plans, and progress over time.

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