HSBC Holdings plc
Environmental, Social and 
Governance Update 
April 2019

Connecting customers 
with opportunities
HSBC aims to be where the growth is, enabling 
businesses to thrive and economies to prosper,  
and ultimately helping people to fulfil their hopes  
and realise their ambitions.
Hong Kong Stock Code: 5
Incorporated in England on  
1 January 1959 with limited liability 
under the UK Companies Act
Registered in England:  
number 617987
The information set out in  
this document, taken together 
with the information relating 
to environmental, social and 
governance (‘ESG’) issues in our 
HSBC Holdings plc Annual Report 
and Accounts 2018, aims to 
provide key ESG information and 
data relevant to our operations 
for the year ended 31 December 
2018. In this context, we have 
also considered our obligations 
under the Environmental, Social 
and Governance Reporting Guide 
contained in Appendix 27 to The 
Rules Governing the Listing of 
Securities on the Stock Exchange  
of Hong Kong Limited (‘ESG Guide’). 
 
To the extent that we have not 
complied with the relevant ‘comply 
or explain’ provisions in the ESG 
Guide, it is because we have chosen 
to focus on issues that we consider 
are material to our stakeholders, 
taking into account the nature of 
our business. This is aligned with 
the materiality reporting principle 
that is set out in the ESG Guide. 
Please see ‘Assessing materiality’ 
on page 5 for further information  
on how we determine what issues 
are material to our stakeholders.  
We will continue to develop and 
refine our reporting and disclosures 
on ESG issues in line with feedback 
received from our investors and 
other stakeholders, and in view  
of our obligations under the  
ESG Guide.

Contents
Our values
Our values define who  
we are as an organisation 
and make us distinctive.
Dependable
We are dependable, 
standing firm for what  
is right and delivering  
on commitments.
Open
We are open to different 
ideas and cultures, and 
value diverse perspectives. 
Connected
We are connected to our 
customers, communities, 
regulators and each other, 
caring about individuals  
and their progress. 
ESG As a reminder
As a reminder
Reporting currency
We use US dollars.
All figures are accurate  
as at 31 December 2018, 
unless otherwise stated.
Adjusted measures
We supplement our IFRS 
figures with alternative 
performance measures  
used by management 
internally. These measures 
are highlighted with the 
following symbol:
Overview 
An overview of what we do and where, our  
global reach, our strategy and our stakeholders.  
It is introduced by the Group Chief Executive,  
and also sets out our ESG approach.
2	
Group Chief Executive’s review
3	
HSBC at a glance 
4	
Our strategy
5 	
Our stakeholders
6	
Our approach
Customers
Details of how we listen to our customers, act on feedback 
and respond when things go wrong. The section reports 
across our four distinct customer groups: our retail 
customers; medium and large-sized corporate customers; 
global and institutional customers; and high net worth 
customers. It also puts a spotlight on conduct and our 
approach to technology, cybersecurity and data privacy.
7	
At a glance
8 	
Our Retail Banking and Wealth 
Management customers
12 	 Our Commercial Banking 
customers
14 	 Our Global Banking and 
Markets customers
16	
Our Global Private Banking 
customers
18	
Customer developments across 
all global businesses
Employees 
Details of how we listen to our people, recognise  
good conduct and set out our whistleblowing policies.  
It also includes our approach to diversity and inclusion, 
and our ambition to create the healthiest human system  
in our industry. 
20	
At a glance
22	
Listening to our people
24	
A healthy and diverse 
workforce
25	
Well-being and developing  
our people
Supporting sustainable growth
Details of our approach to sustainable finance, the 
transition to a low-carbon economy, suppliers and  
our own operations. It also sets out our second TCFD 
disclosure and our partnerships in the communities  
in which we operate.
26	
At a glance
27	
Sustainable finance
29	
Our approach to climate  
risk management
30	
Task Force on Climate-related 
Financial Disclosures
31	
Suppliers
32	
Sustainable operations
34	
Committed to communities
A responsible business culture
Details of our corporate governance as well as our 
approach to tax and human rights. It also provides an 
update on actions taken in light of past conduct events  
and reports on how we are tackling financial crime.
36	
At a glance
37	
Restoring trust
40	
Ensuring strong  
corporate governance
41	
Safeguarding the  
financial system
42	
Keeping a responsible  
approach to tax
43	
Respecting human rights
44	
Supporting financial inclusion
Additional information 
Further information on our approach to ESG issues.  
It contains links to further content, policies and  
topics discussed in this document. Like any industry  
and company, we have our set of abbreviations and 
terminology. Accordingly, we provide an explanation  
of the abbreviations used. A glossary of key terms  
is available online at www.hsbc.com/investors.
46	
Forward-looking statements/
Non-GAAP financial information
47	
Abbreviations/ 
Certain defined terms
48	
Useful links/Photography credits
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
1
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview

Group Chief Executive’s 
review
If we can live up to our wider societal obligations, then we believe  
we will materially improve all aspects of HSBC’s performance and 
safeguard the future of the organisation for generations to come.
John Flint Group Chief Executive
There is much in here that we can be proud  
of. Employee satisfaction is up, reflecting an 
improvement in the way we engage with and 
support our people. We have improved the way  
we listen to customers and acted on that feedback, 
and we have simplified our governance structures 
to create clearer and stronger lines of authority.  
We have also accelerated our support for the 
low-carbon transition.
Yet for all our strides, there are areas where we can 
and must do better. Our senior leadership teams 
are still not diverse enough. Many of our customers 
still find it too difficult to bank with us. On conduct, 
we have more to do in adapting to changing 
societal expectations. 
Addressing these aspects of our performance  
will take time. There are no quick or easy fixes.  
But where there is work to be done, we will do  
so with urgency, conviction and clear purpose. 
As Group Chief Executive, my overriding priority  
is to create stronger relationships with all our 
stakeholders – and it is part of our ambition to 
create what we call the healthiest human system  
in our industry. If we can do that, and live up to  
our wider societal obligations, then we believe  
we will materially improve all aspects of HSBC’s 
performance and safeguard the future of the 
organisation for generations to come. 
All of you reading this are part of that ambition. 
Your feedback and your views are important to  
us. We will continue to take them into account,  
and to listen, learn and act. 
I hope you find the report useful.  
John Flint
Group Chief Executive
Living up to our wider societal obligations  
has always been part of HSBC’s culture and 
identity. Our success over 154 years has been 
founded on our ability to build strong and trusted 
relationships not just with our customers, but  
with the communities and other stakeholders  
we serve all over the world. 
We recognise that there have been times, 
particularly in the recent past, where we have 
failed to meet the standards expected of us.
Societal expectations are changing, and investors 
are placing increasing importance on the wider 
impact businesses have on people and the planet. 
So over the past few years we have taken steps  
to improve all aspects of our non-financial 
performance, and to live up to the duty of  
care we have to all our stakeholders today. 
This ESG Update – the fourth we have produced 
– shines a light on our progress. It covers all the 
usual areas, from corporate governance and our 
environmental impact, to customer satisfaction  
and our approach to conduct. We are continuing  
to meet our reporting obligations under the terms 
of the UN Global Compact and renewing our 
commitment to the Compact’s principles.
“Our success over 154 years has been  
founded on our ability to build strong  
and trusted relationships.”
2
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Overview

Middle East 
 
and North Africa 
 
(excl. Saudi Arabia)
3%
North America
10%
Latin America
2%
UK
29%
Rest of Europe
8%
Rest of Asia
10%
Mainland China
3%
Hong Kong
35%
Percentage of customer accounts 
by value by country/territory. 
HSBC at a glance
Our global reach
Our global businesses
About HSBC
HSBC is one of the world’s largest banking and financial services organisations. The long-term trends outlined on page 10  
of our Annual Report and Accounts 2018 reinforce our strategic advantages as a leading international banking and financial 
services organisation, with access to the fastest growing markets and robust balance sheet strength. The map below 
represents customer accounts by country/territory at 31 December 2018.
Our operating model consists of four global businesses and a Corporate Centre, supported by HSBC Operations  
Services and Technology, and 11 global functions, including: risk, finance, compliance, legal, marketing and human  
resources. An overview of our global businesses is available on page 7.
We hold 
$2.6tn 
of assets 
See page 46 of our Annual Report and Accounts 2018 for further information on our customers and approach to  
geographical information.
More than
39 million
customers bank with us
 
We employ around
235,000
people around the world (full-time 
equivalent staff)
We have around
200,000
shareholders in 130  
countries and territories
3
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Our strategy
Our international network, access to high growth markets and balance 
sheet strength help us to deliver long-term value for our stakeholders.  
This strong combination of strategic advantages supports our strategy, 
enabling us to connect customers to opportunities. 
Strategic priorities1
Targets by end of 2020
Deliver 
growth  
from 
strength
1
Accelerate growth from our Asia 
franchise; be the leading bank to  
support drivers of global investment: 
China-led Belt and Road Initiative and 
the transition to a low-carbon economy
High single-digit revenue growth per annum from  
Asia franchise
Market share gains in eight scale markets10
No.1 international bank for Belt and Road Initiative
$100bn in sustainable financing and investment11
2
Complete the establishment of the UK 
ring-fenced bank and grow market share
Market share gains
3
Gain market share and deliver growth 
from our international network
Mid to high single-digit revenue growth per  
annum from international network14
Market share gains in transaction banking
Turnaround  
of low-return  
business
4
Turn around our US business
US return on tangible equity >6%
5
Improve capital efficiency
Increase in asset productivity
Build a  
bank for the 
future that  
puts the 
customer at 
the centre
6
Create capacity for increasing 
investments in growth and  
technology through efficiency gains
Positive adjusted jaws, on an annual basis,  
each financial year
7
Enhance customer centricity  
and customer service
Improve customer satisfaction17 in eight  
scale markets10
Empower  
our people
8
Simplify the organisation  
and invest in future skills
Improved employee engagement
ESG rating: ‘Outperformer’21
1. A full progress update on our strategic priorities is available on pages 12 and 13 of our Annual Report and Accounts 2018.
2. Return on tangible equity (‘RoTE’) is calculated as reported profit attributable to ordinary shareholders less changes in goodwill and present value of 
in-force long-term insurance business divided by average tangible equity. A targeted reported RoTE of greater than 11% in 2020 is broadly equivalent  
to a reported return on equity (‘RoE’) of 10%, and assumes a Group CET1 ratio greater than 14%.
* For footnotes 10, 11, 14, 17 and 21, see page 67 of the Annual Report and Accounts 2018. 
Return to growth and value creation 
We entered the next phase of our strategy in 2018, focused on growth and creating value for our stakeholders. In our June 2018 
Strategy Update we outlined eight strategic priorities to deliver growth, improve returns, empower our people, and enhance our 
customer experience. Each priority has a target or set of targeted outcomes by 2020.
Delivery against 
Group financial 
targets
For further details, see  
page 17 of the Annual  
Report and Accounts 2018.
Return on tangible equity2
 
Adjusted jaws
 
Dividends per ordinary  
share in respect of 2018
8.6% 
Target: >11% by 2020 (2017: 6.8%) (1.2)%
Target: positive
$0.51
Target: sustain
4
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Overview

Employees
Communities
Customers
Suppliers
Regulators 
and governments
Investors
Planet
Society
Our stakeholders
Building strong relationships with our stakeholders will  
help enable us to deliver our strategy in line with long-term 
values, and operate the business in a sustainable way.
Engaging with our stakeholders 
Assessing materiality
Our stakeholders are the 
people who work for us, bank 
with us, own us, regulate us, 
and live in the societies we 
serve and the planet we  
all inhabit. These human 
connections are complex  
and overlap. Many of our 
employees are customers  
and shareholders, while our 
business customers are often 
suppliers. We exist to serve, 
creating value for our 
customers and shareholders. 
Our size and global reach 
mean our actions can have  
a significant impact, which  
is why we want to create  
the healthiest human system 
in financial services to help 
enable our business strategy.
We listen to our stakeholders in a number of different ways, 
from employee and customer surveys to client meetings. 
Investors tell us what matters to them in the annual ESG 
investor survey and in qualitative assessments during investor 
meetings. We are also informed by stock exchange listing  
and disclosure rules in Hong Kong, the UK and the US.
We use this information to identify what issues are material  
to our stakeholders, taking into account the nature of our 
business. In line with the provisions of the ESG Guide,  
an issue is considered to be material when management 
determines that it has become sufficiently important to  
our stakeholders that it should be publicly reported.
Management tables material issues for discussion at the  
ESG Steering Committee and other relevant governance 
forums. We use these themes and concerns as a guide  
for our ESG Update. Further information about the ESG 
Steering Committee is included in the ‘Ensuring strong 
corporate governance’ section of the report on page 40. 
We acknowledge that material issues evolve over time,  
and we will continue to assess them to ensure we remain 
current in our approach and communications. 
5
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Our approach 
Reporting on material issues in an open  
and transparent way is key to meeting  
the expectations of our stakeholders. 
Our ESG approach
––We support the global transition to the 
low-carbon economy through our own 
sustainable operations and by supporting 
our customers with their transition.
––We maintain robust climate-related risk 
management, covering sensitive sectors, 
such as energy, palm oil and forestry.
––We aim to maintain high standards  
of governance across all geographies.
––We are committed to protecting our 
customers and communities through 
financial crime risk management and 
cybersecurity due diligence.
Environmental
Social
Governance
Examples:
––In our ambition to provide $100bn of sustainable financing, 
facilitation and investment by 2025, we have delivered  
a cumulative total of $28.5bn since 2017, with external 
assurance of this number provided by PwC using ISAE 
3000. The full assurance statement is included on page 28.
––We are a signatory to the Financial Stability Board  
Task Force on Climate-related Financial Disclosures.  
The second year disclosure is available on page 30.
Examples:
––During 2018, we concentrated on the completion of the  
final elements of our Global Standards programme, which  
is designed to ensure the management of financial crime 
compliance is embedded in our day-to-day management  
and governance.
––We are committed to applying both the letter and spirit  
of the law in all the territories in which we operate.
Examples:
––In this report, we publish customer information for each of 
our global businesses, including spotlights on conduct. This 
includes information on the strengthening of our controls, 
and achieving fair outcomes for customers and culture.
––Our employee surveys give us invaluable insight into our 
people. Results in 2018 show that 74% feel able to speak  
up when they see behaviour that they consider to be wrong.
––We are building a diverse workforce and have set a target  
of 30% women holding senior leadership roles by 2020. 
Currently 28% of our senior leaders are women, so while  
we are making progress we recognise there is still room  
for improvement.
Our conduct approach
We recognise that we have a responsibility for good conduct 
through the delivery of fair outcomes for customers and 
behaving in a way that protects financial markets integrity.  
We have therefore implemented a conduct framework 
describing the outcomes that must be delivered across the 
Group and which in turn form a key component of our risk 
management framework. This means that our decisions should 
consider the impact on customers and markets. In addition, 
delivery of the required Group values and conduct behaviours 
continues to be considered in performance management  
for our people across the Group. Our conduct is overseen  
by senior risk and executive committees within each of our 
businesses, functions and HSBC Operations Services and 
Technology. The Board maintains oversight of conduct  
matters through the Group Risk Committee. 
––We aim to grow in a way that puts the 
customer at the centre.
––We want to create the healthiest human 
system in our industry. We are working to 
create the right environment so everyone 
can fulfil their potential.
––We are focusing on diversity and inclusion 
in our workforce, and we are striving to 
put the customer at the heart of everything 
we do.
6
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Overview

Customers
We aim to grow in a way that puts the  
customer at the centre by improving  
performance with digital enhancements  
while maintaining financial crime standards. 
At a glance
Our relationship
Our purpose is to be where the growth is, connecting 
customers to opportunities. We help enable businesses  
to thrive and economies to prosper, helping people fulfil  
their hopes and dreams and realise their ambitions. 
We create value by providing the products and services  
our customers need, and aim to do so in a way that fits 
seamlessly into their lives. This helps us to build long-lasting 
relationships with our customers. We maintain trust by 
striving to protect our customers’ data and information,  
and delivering fair outcomes for them – and if things  
go wrong, we need to address complaints in a timely 
manner. Operating with high standards of conduct is  
central to our long-term success and underpins our  
ability to serve our customers.
In this section we report on our customers as four  
distinct groups: our retail customers; medium and large-
sized corporate customers; global and institutional 
customers; and high net worth customers. These groups  
 are serviced by our four global businesses respectively: 
Retail Banking and 
Wealth Management 
(‘RBWM’)
Commercial Banking 
(‘CMB’)
Global Banking and 
Markets (‘GB&M’)
Global Private  
Banking (‘GPB’)
We help 38 million customers 
across the world to manage 
their finances, buy their 
homes, and save and invest  
for the future.
Our HSBC Premier and 
Advance propositions are 
aimed at mass affluent and 
emerging affluent customers 
who value international 
connectivity. For customers 
with simpler banking needs, 
we offer a full range of 
products and services 
reflecting local requirements. 
We support approximately  
1.5 million business customers 
in 53 countries and territories, 
ranging from small enterprises 
focused primarily on their 
domestic markets, through  
to large companies  
operating globally.
Our services include working 
capital, term loans, payment 
services and international 
trade facilitation, as well as 
expertise in mergers and 
acquisitions, and access  
to financial markets.
We serve approximately  
4,100 clients in more than 50 
countries and territories. We 
support major government, 
corporate and institutional 
clients worldwide.
Our product specialists 
continue to deliver a 
comprehensive range of 
transaction banking, financing, 
advisory, capital markets and 
risk management services. 
We serve high net worth  
and ultra high net worth 
individuals and families, 
including those with 
international banking needs.
Services provided include 
Investment Management, 
which includes advisory  
and brokerage services,  
and Private Wealth Solutions, 
which comprises trusts and 
estate planning, to protect  
and preserve wealth for  
future generations.
7
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Our Retail Banking and Wealth 
Management customers 
How we listen to our customers
the same levels or improved compared  
with last year. We have focused on 
improving our customer service training and 
providing simpler processes with enhanced 
technology. We also launched our Universal 
Banker programme in five markets,  
which helps train our people to be digitally 
equipped, and empowers them to resolve 
more queries themselves. Over 4,000 
employees are now Universal Bankers.  
Less positively, the satisfaction score of  
our US contact centres fell and overall 
complaints rose, driven by a significant 
overhaul of the banking platform, which 
led to increased call volumes and customer 
wait times. We addressed this through 
increasing headcount and expanding our 
chatbot capabilities.
We listen to our customers in a number  
of different ways, including through our 
interactions with them, surveys, social 
media and from their complaints. We use 
these insights to improve our services.  
Customer recommendation 
In 2018, we surveyed more than two million 
customers on their likelihood to recommend 
HSBC to others and their satisfaction  
with our services. We have made some 
progress, with recommendation scores 
improving in the majority of markets. More 
customers recommended us for being 
easily accessible, offering good digital 
services, and our overall customer service. 
However, our savings accounts remain an 
area of dissatisfaction, with more customers 
telling us they are seeking competitive rates 
and charges. In the UK, the First Direct 
brand ranked first for mobile banking 
services and second overall in the 
Competition and Markets Authority 
rankings in 2018, where banks were scored 
by customers on the quality of service.
In 2018, we changed the way we  
report customer recommendation by 
broadening the range of customers we 
survey, and by looking at the full range of 
scores provided. We believe this provides  
a more representative and complete 
perspective on the customer service  
we offer relative to the market. 
Customer satisfaction 
Customer satisfaction in our online banking 
services rose in some of our key markets in 
2018, following significant declines in the 
previous year. The decline in satisfaction in 
2017 came after the launch of a new online 
banking system and enhanced security 
features. The new platform should help 
enable us to roll out new digital services at 
a faster pace while keeping our customers 
safe. However, we saw a drop in customer 
satisfaction as customers learned how to 
use the new service. By listening to our 
customers, we improved the way we 
communicated changes and fixed a 
number of the issues that were causing  
the most frustration, such as login and 
payments. Four out of the five most 
Customer satisfaction and customer recommendation survey results
Customer satisfaction1
Customer 
recommendation  
scores2
Branch
Contact  
centre1
Relationship 
manager
Online  
banking
UK
  88%
(2017: 86%)
  76%
(2017: 70%)
 80%
(2017: 79%)
 80%
(2017: 71%)
 75%
(2017: 72%)
Hong Kong
 87%
(2017: 87%)
 93%
(2017: 90%)
 74%
(2017: 71%)
 47%
(2017: 49%)
 71%
(2017: 72%)
France
 78%
(2017: 74%)
 69%
(2017: 68%)
 76%
(2017: 70%)
 70%
(2017: 72%)
 73%
(2017: 74%)
US
 88%
(2017: 87%)
  54%
(2017: 72%)
 80%
(2017: 80%)
 64%
(2017: 57%)
 67%
(2017: 65%)
Canada
 84%
(2017: 82%)
 76%
(2017: 66%)
 85%
(2017: 85%)
 68%
(2017: 34%)
 68%
(2017: 66%)
Mexico
 89%
(2017: 90%)
 80%
(2017: 82%)
 78%
(2017: 91%)
  78%
(2017: 81%)
 91%
(2017: 90%)
Singapore
 74%
(2017: 73%)
 87%
(2017: 88%)
 71%
(2017: 62%)
 47%
(2017: 46%)
 75%
(2017: 69%)
Malaysia
 76%
(2017: 71%)
 65%
(2017: 64%)
 72%
(2017: 73%)
  61%
(2017: 61%)
 78%
(2017: 83%)
Mainland 
China
 94%
(2017: 93%)
 92%
(2017: 94%)
 74%
(2017: 73%)
 54%
(2017: 46%)
 84%
(2017: 82%)
UAE
 74%
(2017: 70%)
 68%
(2017: 66%)
 67%
(2017: 66%)
  69%
(2017: 69%)
 87%
(2017: 84%)
1. Customer satisfaction is calculated by percentage of customers providing an 8 or above on a scale  
from 0 to 10. For contact centre scores, the exceptions are the US, Canada and Singapore in 2017, and 
Singapore in 2018, where the score shows the percentage of customers rating 4 or above out of 5.
2. The index uses the 0–10 rating scale for the customer recommendation question to create a 100 point index. 
This survey is run by an independent and global market research agency. Following the reporting change, 
2018 and 2017 figures have been restated to focus on the full range of scores provided by customers.
affected markets in 2018, the UK, Canada, 
US and China, experienced recoveries  
in customer satisfaction. However, in  
Hong Kong, our customers were more 
dissatisfied by our browser-based banking 
experience. We have responded with new 
initiatives to improve the experience such 
as adding real-time customer assistance 
capabilities, and plan to continue 
enhancements to our capabilities. In 2018, 
we focused our efforts on upgrading our 
mobile banking experience where we have 
seen the highest growth in customer 
usage. See page 18 for more details. 
In most markets, customer satisfaction  
with our branches, contact centres and 
relationship managers has either maintained 
8
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Customers

Acting on feedback
Area of focus
Action
Making banking 
accessible
We have expanded rolling out our simplified login process. Apple’s Touch ID is now live in 18 markets and HSBC Voice ID  
is in five markets. Last year, 80% of customer transactions were conducted via mobile or online channels. More than 30%  
of loans, cards and deposits sales were through digital channels.
In the UK, we trained our front-line people to become more digitally proficient. In branch or on the phone, they can show 
customers how to complete tasks digitally. Last year, 85% of new customers opened accounts through a supported  
digital experience.
Making our  
processes easier
In the UK, we are simplifying our mortgage process. Applications can be approved within 10 days with the help of 
automatic valuations, improved credit policies and increased underwriter availability.
To make investing more accessible, we equipped our branch employees in Hong Kong, mainland China and Singapore 
with mobile tablets, and launched an online financial health check. Customers can now understand their investment 
options in their own time, without a specialist appointment. For more information on our digital enhancements, please  
see ‘Our investment in technology’ on page 18.
Making it easy to 
understand us and  
our fees and charges
In Singapore, we simplified our mortgage application forms and offer letters, so customers can be clear about their 
repayment schedule, terms and conditions, and fees and charges. 
Through digital messaging we are raising customer awareness around overdrafts in the UK, Hong Kong, France and the  
US. In the UK, we expanded the volume of overdraft alerts, which we first introduced in 2017, sending more than 26 million 
alerts in 2018 to help customers save money. Over half (56%) of customers who receive an alert pay in funds to avoid 
charges. To help even more customers avoid fees, we are introducing services like our Connected Money app, which  
helps people keep track of their spending (see page 11).
When things go wrong
We aim to ensure customers’ complaints 
are recorded so we can understand what 
went wrong and why, and then act upon 
the feedback. Complaints are monitored 
and reported to governance forums. 
Senior executives are measured against 
complaint-handling performance. 
The way we handle complaints and how 
fast we respond is important to us and our 
customers. In 2018, we resolved 77% of 
complaints on the same or next working 
day, and 86% within five working days, 
excluding UK complaints related to 
payment protection insurance (‘PPI’).  
The most common complaints related to 
process and procedures (39%), service 
(25%), and fees and charges (9%).
In 2018, we received approximately 1.2 
million complaints from retail customers  
in our large markets referenced in the 
adjacent table, a 16% increase compared 
with 2017, primarily driven by the UK and 
Mexico. The increase in UK complaints 
mainly related to PPI, which is consistent 
across the UK industry, and to digital 
registration issues. An improvement 
programme for non-PPI complaints was 
introduced in 2018, resulting in complaint 
volumes declining in the fourth quarter. Our 
business in Mexico experienced an increase 
in complaints due to the prevalence of 
online fraud transactions leading to service 
interruption. We provided refunds to the 
customers and strengthened our fraud 
control measures, as well as launching a 
card control app that allows customers to 
manage deactivating controls on online 
card usage. As of September 2018, the 
Financial Services Consumers Protection 
Bureau in Mexico ranked HSBC as the best 
bank among the seven largest banks for 
complaint resolution and quality of service 
on their Customer Care Performance Index. 
Complaints at our UAE business fell 18%, 
but remained relatively high. Complaints 
were primarily due to manual processes, 
service delays, staff knowledge and clarity 
of our communication to customers. These 
continue to be addressed through a 
customer experience programme.
1. A complaint is defined as ‘any expression  
of dissatisfaction, whether upheld or not, from  
(or on behalf of) a former, existing or prospective 
customer relating to the provision of, or failure to 
provide, a specific product or service activity’.
RBWM complaint volumes
Complaints per 1,000 
customers per month1
2018
2017
UK
4.0
3.3
Hong Kong
0.5 
 0.7
France
4.7
6.0
US
3.9
3.4
Canada
3.1
2.7
Mexico
5.3
4.5
Singapore
1.4
1.6
Malaysia
0.4
0.5
Mainland China
0.7
0.7
UAE
5.6
6.8
9
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Our Retail Banking and Wealth Management customers

We recognise we have a responsibility  
to deliver fair outcomes for our retail 
customers and behave in a way that 
protects financial market integrity. We 
manage this through a range of activities, 
from working to ensure products are 
designed fairly to endeavouring to  
meet customers’ financial needs. 
We have put in place clear policies, 
frameworks and governance to protect  
our customers. Our conduct and risk 
frameworks describe the outcomes that 
must be delivered across the Group. In 
performance management, we consider 
whether behaviour is in line with our 
values. Conduct is overseen by senior risk 
and executive committees, while the Board 
maintains oversight of conduct matters 
through the Group Risk Committee. 
Product design and fair value 
Good product design helps provide the 
right outcomes for our customers. We 
provide training through the Product 
Management Academy. To date, more 
than 1,000 of our people have completed 
training on topics including customer 
insight, customer-focused design,  
making communications simple, product 
development, management oversight  
and governance. 
Customer insight is the foundation of  
the design process, so we work with 
customer research groups to co-create 
solutions. This involves checking in  
with customer panels and user labs 
throughout the process to understand 
customer reaction, so we can dynamically 
adapt designs to meet changing needs. 
In Mexico, we launched our Stilo  
banking service, which includes a money 
management tips app, filling a gap in 
service that our customers had told us 
about. In Hong Kong, we worked with 
more than 3,000 customers to design  
and test our PayMe services and features 
before launching them, including peer-to-
peer payments for customers and 
non-customers. PayMe reached a 
milestone of approximately 1.5 million 
users in 2018. 
The range of products offered in our 
markets is managed globally. Any newly 
developed product goes through a 
review process with global oversight for 
different or complex products. During 
this process, products are tested to help 
ensure they are suitable and offer fair 
value to customers.
Ongoing monitoring is also a critical 
component of our product governance 
programme. Regular in-depth reviews 
recognise a product or service may 
become unsuitable over a period of time, 
whether it is after a significant event  
or following an accumulation of  
multiple changes.
Product design key principles:
Our products should remain relevant  
in each country they are offered.
We offer a consistent, simple and 
carefully selected range of products.
We act on feedback from customers  
to provide better and more accessible 
products/services. 
Products that no longer meet our  
high standards or customer needs  
are withdrawn from sale.
We also conduct regular product reviews 
and fair value assessments in each of the 
markets we operate in, to help ensure we 
deliver fair value.
Pricing key principles:
All products and services must meet  
a minimum set of design standards.
We carry out regular comparisons  
of HSBC pricing with those of local 
competitors and with our own fair  
value standards, considering the total 
charges and features of a product.
We review the usage levels of product 
features to assess if customers’ 
behaviours and responses demonstrate 
they are receiving value.
Oversight and governance of our  
fair value assessments and product 
safety is provided by the Global Wealth 
Management Oversight Committee, 
chaired by the Global Head of Wealth 
Products, and the Retail Banking 
Management Committee, chaired  
by the Global Head of Retail Products. 
The RBWM Global Incentive Committee, 
which reports to the Chief Executive 
Officer of RBWM, oversees front-line 
employee incentives.
Meeting our customers’ needs
In order to meet customers’ needs 
effectively, we have robust oversight of 
the sales process, including reviewing 
the suitability of the products we offer, 
sales quality monitoring, and how we 
incentivise our staff.
We consider our customers’ financial 
needs and personal circumstances to 
assist us in offering suitable product 
recommendations. This is achieved 
through: 
––a globally consistent methodology  
to rate the riskiness of investment 
products, which is customised for  
local regulatory requirements;
––a robust customer risk profiling 
methodology to help assess 
customers’ financial objectives, 
attitude towards risk, financial ability  
to bear investment risk and their 
knowledge and experience;
––goal projection tools and calculators  
to help customers plan for their future 
in line with their overall investment 
objectives; and 
––consistent global advisory standards to 
follow when we make recommendations 
to our customers, while taking into 
account local regulations.
From a service perspective, our goal 
is to empower our people to resolve 
issues. In the UK, we embedded a 
programme to give front-line employees 
a means to raise and contribute towards 
solving customer issues and to escalate 
Spotlight: Conduct
10
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Customers | Our Retail Banking and Wealth Management customers

larger issues to executive management. 
Since introducing the programme in  
late 2017, over 8,000 issues have been 
raised, and in 2018 more than 6,500  
were resolved.  
Sales quality
To assure the quality of our sales process 
and employees’ behaviour in each of our 
markets, we either conduct a mystery 
shopping programme or a sales quality 
programme, or both. Issues identified are 
treated seriously. Action is taken to help 
achieve a fair outcome for customers.
Where concerns are found, we will 
contact the customer to explain and 
remediate. Depending on the severity  
of the issue, the relevant employee will 
be given enhanced training to improve 
their behaviour and they may become 
ineligible for an incentive reward 
payment. Where a case of misconduct 
occurs, disciplinary action may be  
taken, which can lead to dismissal.   
Front-line employee incentives
In 2013, we changed our front-line 
incentives to create a discretionary 
framework rather than a straight formula 
between sales and reward. Our people 
are now recognised for demonstrating 
our values and behaviours as well as 
meeting customers’ needs through 
products and services. The framework 
exists to recognise our front-line 
employees who go above and beyond  
for the customer, to deliver fair outcomes 
and support the sustainable growth of 
our business.
Aligned to our customer experience 
standards, the incentive framework 
assesses how our people listen to our 
customers to understand their needs  
so that they can provide appropriate 
solutions. Should an individual 
demonstrate behaviours that do not  
align with our core values, there is a 
disciplinary process that again can  
affect reward payments.
Building financial capability 
Delivering fair outcomes for customers 
also involves providing tools and content 
that help customers have the confidence 
and competence to make the most of 
their money. In 2018, we made public 
commitments around building financial 
capability, and we took a number of 
actions to deliver on these commitments:
––In the UK, we launched the HSBC 
Connected Money app, which helps 
users see all their banking relationships 
in one place and keep track of how  
they spend their money. It has been 
downloaded 240,000 times. One  
recent new feature allows users to  
keep track of savings goals using  
virtual savings pots.
––We introduced card control features  
in the UK, Hong Kong and Mexico,  
so customers can control their  
card spending and receive real-time 
alerts on their activity. In Mexico, 
customers can set spending limits  
and block spending categories,  
such as online shopping and 
entertainment, including gambling.
For further details on how we support  
building financial capability and inclusion,  
see pages 34 and 44.
Managing fraud
Fraudulent activities are a risk and  
a concern for our customers. We  
are committed to mitigating and 
reducing their impact through a  
range of actions, including new fraud 
prevention systems, improvements to 
our internal processes and procedures, 
as well as communications to raise 
awareness. We introduced an automated 
customer contact solution, which uses 
two-way SMS messaging, in the second 
half of 2018. Since its introduction, 
around 4,000 customers per day are  
able to respond instantly to our fraud 
enquiries to either unblock their card  
or report fraud. Approximately half of  
all card fraud-related queries are now 
resolved without the need of a phone 
conversation, which has saved 
customers approximately 87,000 calls 
every month. We plan to introduce this  
service to more of our customers 
throughout 2019.
Operational resilience 
HSBC invests in the reliability and 
resilience of our systems to help prevent 
disruption to customers. During 2018,  
we continued to upgrade our IT systems, 
simplifying our service provision and 
replacing older IT infrastructure and 
applications. These enhancements led  
to continued global improvements in 
service availability during the year for 
both our customers and employees.
For further details on how we aim to maintain 
and continually improve our operational 
resilience capability, see page 19.
Spotlight: Conduct continued
11
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Our Retail Banking and Wealth Management customers

Our Commercial Banking 
customers 
How we listen to our customers
Acting on feedback
We are committed to improving customer 
satisfaction for all our business customers, 
from start-ups to large corporates.
We have introduced additional governance 
to embed a customer-led approach into 
our decision making. In 2018, we created 
the new role of Global Head of Customer 
Experience, and appointed customer 
champions in key business areas. 
New tools have been introduced to help 
us understand our customers. These 
include customer journey mapping, which 
aims to take a holistic approach to assess 
customers’ current experiences and 
design ideal ones. More than 350 of our 
people globally have been trained in its 
use. New artificial intelligence (‘AI’) tools 
used by our insight and analytics teams 
also allow us to scrutinise more open-
ended feedback from customers quickly 
and accurately.
Customer satisfaction
We use syndicated research, feedback 
from social media, and operational data 
to help us identify what areas are most 
important to our customers, and where 
our performance could be improved. 
Areas of focus include the ease and 
speed of the account opening process, 
our efficiency in dealing with queries  
and our range of products. 
We still have some way to go to achieve 
our ambitions, but our rank position against 
competitors for customer satisfaction either 
remained flat or improved compared with 
last year in seven of our eight key markets.1
Moments of Truth
In 2018, we fully embedded our Moments 
of Truth programme, surveys which allow 
us to continually capture feedback from 
customers about interactions we know are 
important to them. We have surveyed over 
18,000 customers across 40 markets and 
have driven improvements through more 
than 100 actions taken to address the 
feedback. Key performance metrics across 
all these key events, such as opening  
an account, calling our contact centres, 
setting up internet banking, applying for 
credit or changing relationship manager, 
have improved in 2018. We actively 
review the interactions we measure to 
make sure we continue to focus on the 
issues that matter most to our customers. 
Listening to customers and acting on their feedback has helped us to drive improvements to the customer experience.  
Here are some of the main issues raised and how we responded.
Area of focus
Action
Improving the  
ease and speed of 
account opening
In the UK, we created a new welcome journey for small businesses. This resulted in improved customer satisfaction 
and increased use of self-service digital tools. In France, we sped up the opening of accounts by simplifying the 
process. In Singapore, new customers are now assigned a single point of contact to help them. A customised video 
also introduces customers to their service team and helps them to get started with online banking. 
Customer query 
handling
We want to make sure our people are fully equipped to answer customer enquiries efficiently and effectively. We 
provided additional training for customer service managers in our Global Trade and Receivables Finance business  
in Singapore and Hong Kong, as well as for our HSBCnet telephone teams to improve their technical and soft skills.  
In the UK, a query escalation process was introduced to improve our ability to resolve queries quickly and accurately. 
Easy channels  
to communicate 
feedback
In order to help make sure our products and services meet customers’ needs, we have more than 200 customers  
as active members of online panels in the UK, Hong Kong, mainland China, Australia, UAE, Mexico and the US. These 
provide fast feedback, allowing us to test changes directly with customers. In 2018, they helped us redesign our online 
banking platform and provided input into developments around integration of third-party accounting software.
Case study: Customer-centric 
payments review
A customer-centric review was 
launched to improve the efficiency  
of our payment processing across 
Asia-Pacific. We created a smoother 
authentication process through  
a one-time password issued  
to customers by text message.  
This avoided three authentication 
questions, which customers told  
us were difficult to use. Customer 
queries are now handled faster by 
giving wider access to the payment 
systems to our employees. These 
changes contributed towards a  
70% reduction of payments-related 
complaints, from their highest point  
in 2017, and a fall in average call 
handling time from 11 to seven minutes.
1. Eight key markets: Hong Kong, UK, Pearl River Delta, Singapore, Malaysia, Mexico, Saudi Arabia and UAE. Customer satisfaction metrics for Pearl River Delta will 
be available from 2019. In Hong Kong, Singapore, Malaysia, Mexico and UAE, CMB performance in 2017 is based on the bank that the customer defines as their 
main bank, while CMB performance for these markets in 2018 is based on the bank that the customer defines as the most important. Surveys are based on a 
relevant and representative subset of the market. Data provided by RFi Group, Kantar and another third-party provider.
12
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Customers

When things go wrong
We support our people to help make  
sure they handle customer complaints 
effectively, with a training module 
available to all relevant employees.  
A new global complaints management 
procedure was delivered in the first 
quarter of 2019 to help make sure we 
continue to manage complaints in an 
equitable and timely way, in an effort  
to provide effective and fair outcomes  
for our customers.
In 2018, we resolved a total of 77,892 
corporate customer complaints, which 
was a 35% year-on-year increase, with 
81% coming from customers in the UK, 
3% in France and 2% in the US. 
We have stepped up our financial crime 
prevention procedures due to increased 
scrutiny in this area, but as a result this 
has led to increased complaints from  
our customers, representing more than  
a quarter (27%) of total complaints. 
Dissatisfaction was often due to requests 
for additional personal and business 
information to help us guard against  
fraud and money laundering. Without 
those details, services were sometimes 
restricted and, in certain circumstances, 
accounts were closed. After reviewing 
customer communications, we have 
improved the content and layout of letters, 
making the process clearer and simpler.
Operational complaints were the  
second highest in volume (25% of total 
complaints), reflecting the most frequent 
customer transactions. Improvements in 
the payment processes and the way  
we handle queries reduced complaints 
significantly in Asia-Pacific. We are keen 
to learn from these events to improve 
customer experience in other markets.
Account opening complaints reflected  
the third largest in volume (7% of total 
complaints). In the UK, challenges with  
the introduction of a new system led to  
CMB annual complaint volumes
Complaints (000s)1
2018
2017
UK
62.8
43.1
Hong Kong
4.9
4.1
Asia-Pacific
0.9
1.1
Europe
3.0
4.8
Middle East and  
North Africa
1.5
1.8
Latin America
2.3
1.2
US
1.8
1.2
Canada
0.7
0.4
Top complaint categories
Complaint categories
2018
2017
Processes and 
procedures
27%
12%
Operations
25%
26%
Account opening
7%
5%
Contact centre
6%
12%
Fees, rates and 
charges
6%
7%
Internet banking
4%
6%
Branch
4%
8%
Others
21%
24%
We regularly review a list of all products 
sold to our corporate customers so they 
remain appropriate and relevant to  
our customers. To help make sure all  
our products meet customer needs,  
we have a rigorous governance and  
approval process for any new product  
or significant changes to existing ones. 
We operate sales outcome testing  
in 12 key markets designed to ensure 
customers have understood the features 
of their chosen products, such as pricing, 
mechanics, risk and benefits. In 2018,  
we identified 132 issues through the 
CMB outcome testing programme, such 
as documentation, sales process, and 
pricing issues. Actions are underway to 
address these issues.
We recognise it is important to provide 
our products at a fair price and in a 
transparent way. Since late 2017, an 
executive pricing steering committee  
has been improving our existing pricing 
framework to help make sure we  
price products and services fairly, 
communicate transparently, and have 
robust controls in place. Following our 
focused efforts, complaints around fees 
and charges have fallen by 20% over  
the last two years.
We have put a strong emphasis on 
communicating to our people on how  
we should behave. We broadcast videos 
of senior leaders speaking about what 
conduct means to them and why it is 
important. We feature examples of 
employees making the right decisions  
in the interests of customers in global 
employee communications. Countries, 
regions and global operations all held 
conduct-themed workshops, informal 
Exchange sessions and town halls.  
Spotlight: Conduct
This has resulted in a significant input  
of ideas and concerns that have allowed 
our leaders to shape their own conduct 
agendas and communications. For 
further details of our Exchange forums, 
see the Employees section on page 22. 
The scorecards for front-line employees 
are now balanced with a maximum  
of 50% being related to performance.  
We are increasingly seeing instances of 
role model behaviours driving upward 
adjustments in variable pay from 1%  
in 2015 to 8% in 2017.
Fraud is a growing problem and we strive 
to protect our customers from financial 
crime. In Mexico, we introduced training 
for our relationship managers focused  
on business email compromise and 
malware fraud so they can pass on this 
knowledge to customers and take the 
right action if a customer is affected.
an increase in complaints. In France,  
rapid business growth during early 2018 
resulted in higher than expected account 
opening requests, increasing the time 
taken to open accounts. Additional 
resources were employed and changes 
implemented to streamline the process, 
resulting in a reduction in complaints later 
in the year.
1. Volumes for the UK are received complaints from eligible complainants to align with the current FCA 
reporting. Volumes of complaints for the rest of the markets are based on resolved complaints. 
13
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Our Commercial Banking customers

Our Global Banking and 
Markets customers 
How we listen to our customers
We provide financial services and 
products to governments, companies 
and institutional clients around the world. 
Listening and reacting to customers  
is one of the most important ways of 
improving our business. One of the 
primary ways we do this is through our 
annual customer engagement survey. 
Customer satisfaction
In this survey, 94% of our customers felt 
our overall service and our commitment 
to their business either improved or 
stayed the same in 2018. Each aspect  
of the survey is carefully reviewed to 
consider which actions can be taken  
to improve customer perceptions of  
us and the service we offer. 
One area where customers were 
dissatisfied was our account opening 
requirements and how we update 
customer information. Some customers 
felt that these were too cumbersome  
and time-consuming. 
As a first step, our credit and lending  
team is rolling out a digital credit platform, 
a service that provides customers with 
standardised, automatically populated 
credit documentation that can be signed 
digitally. This service, now available in the 
UK, has reduced the time it takes for our 
customers to receive financing. 
We are simplifying our know your 
customer (‘KYC’) questionnaire and 
worked with compliance to streamline 
the KYC aspect of customer onboarding. 
This improved our risk management 
process and reduced verification times 
by 25%. We are also streamlining how 
Acting on feedback
Customer survey results
63%
of customers considered  
HSBC as one of their  
top three banks in 2018 
(2017: 64%)
46%
of customers felt our people are 
more likely to initiate a strategic 
conversation than 12 months ago 
94%
of customers felt our service 
had either stayed the same  
or improved in 2018 
(2017: 96%)
95%
of customers felt they had  
a good or very good rapport 
with GB&M
Responding quickly and efficiently to customers’ feedback 
and complaints helps to build trust. We are placing a strong 
emphasis on this, and reviewing the formal complaints 
process in place for customers across all of the GB&M 
business lines to improve its effectiveness. 
New tools have been adopted to better record complaints and 
track their resolution. In November 2018, we created a new 
global team to look specifically at customer experience. With 
a broad mandate, it focuses on careful analysis of feedback 
and rapid resolution of complaints. 
One of its immediate tasks is to consolidate customer 
feedback and complaints across multiple business lines, 
geographies and products. This should help us improve the 
customer experience, and identify any areas for collaboration 
or early detection of potential issues.
Customer experience meetings are now scheduled regularly 
with our top management. These bring together senior people 
to look closely at customer concerns and produce consistent, 
business-wide solutions. 
we collect and store KYC information, 
technology solutions and data access. 
We reduced onboarding times for our 
corporate customer base by 8% by the 
end of 2018. There is still a lot to do and 
our target is to reduce this by a further 
20% by 2020. 
For more information on some of the 
ways we have made it easier and safer 
for customers to access our services 
digitally, see page 18.
Case study: Improving payments processing 
In 2018, we were approached by a potential customer  
who was looking for a new banking provider to resolve 
problems they had faced regarding delayed payments. 
Staff salary payments had been repeatedly delayed, due  
to a screening process that banks are required to carry  
out to comply with regulations. This was an increasing 
reputational risk for the firm. When we looked into the 
problem for them, it focused our attention on similar  
issues faced by our existing customers. Not only did  
we win this firm as a new customer, we also proposed  
to take a proactive approach to screening payments  
for existing clients, which notifies customers of any  
delays and obtains additional information needed to 
identify and release blocked payments within a target  
of 48 hours. By making sure we collect information on 
regular beneficiaries upfront and use it effectively, we have 
significantly reduced payment delays for our customers. 
14
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Customers

When things go wrong
Overall, the number of complaints 
increased in 2018, mainly in Global 
Liquidity and Cash Management 
(‘GLCM’) due to a number of significant 
systems upgrades and issues throughout 
the year. In most other GB&M 
businesses, the number of complaints 
either reduced or remained stable from 
2017. In Global Markets, we had a 
reduction in complaints resulting from 
human error and processing issues in  
our operations team. In Global Banking, 
the number of recorded complaints fell, 
in part due to improvements to how  
we record feedback. Previously, many 
complaints that were related to the range 
of products and services offered by 
HSBC were recorded by Global Banking, 
where the overall customer relationship 
is managed. In 2018, we have aimed, 
where possible, to record specific 
complaints in relation to products and 
services against their specific product 
line such as GLCM and Global Trade  
and Receivables Finance products.
Spotlight: Conduct
Improving employee conduct remains one 
of GB&M’s core priorities as we continue to 
pursue the highest standards across every 
aspect of our business. The way in which 
we conduct business helps us fulfil  
our purpose of connecting clients to 
opportunities and helping economies to 
grow, while staying true to our values. 
Customers rely on us for our financing, 
advisory and research expertise. They know 
we can access global debt, equity, currency 
and commodity markets. It is vital that they 
trust us to manage their liquidity, keep their 
assets safe, and finance their trade. 
In 2018, we took a fresh look at how  
to help deliver fair outcomes for our 
customers, and help ensure we do  
not cause disruption to the orderly and 
transparent operation of financial markets. 
We worked with third-party experts to 
highlight areas that needed improvement, 
which led to a comprehensive new 
programme to improve our conduct. The 
key areas of focus are highlighted below: 
Culture and environment
––We are expanding the dialogue  
on conduct to help ensure we are 
supporting our people to make values-
based judgements in situations they  
face every day, and feel safe raising 
concerns. In the first half of 2018, 5,200 
of our people attended 650 Exchange 
meetings to discuss our conduct and 
culture, with further Exchange meetings 
held through the rest of 2018.
––We have developed a network of conduct 
champions across the business to help 
drive conduct awareness and provide a 
group of enthusiastic, committed people 
to act as local sponsors for behavioural 
change. We have led region-specific 
conduct weeks, where we highlighted 
examples of conduct in action across the 
business, and produced and updated 
country-specific conduct handbooks. 
––We have a complex footprint across 
different businesses, countries and desks. 
This can lead to a number of different 
cultures – some of which will have issues 
that need to be addressed. In 2018,  
we began a series of pilot exercises to 
examine the root causes of employee  
and team behaviour, and to help design 
interventions. This will continue in 2019.
––We introduced a new hiring guide  
for managers to support the assessment  
and selection of candidates, and 
strengthen our interview process  
with a broader inclusion of values  
and behavioural measures.
––Our management and staff wanted more 
training on conduct and how it applies  
to them and their roles. We continue  
to improve our conduct curriculum to 
meet this demand, including coverage  
of behavioural drivers, conflicts, grey 
areas and specific technical training.
Embedding conduct in core 
business processes
––We have created a Global Markets 
product risk function and appointed 
co-Heads of Product Governance in 
Global Markets to improve product 
governance. Product due diligence 
templates used across GB&M have been 
enhanced in an effort to ensure conduct 
is more carefully considered. Sales 
suitability procedures have been 
developed for people working in Global 
Banking and the Institutional Client 
Group, and training has commenced  
for Global Markets sales employees. 
––In our Exchange meetings on conduct  
and culture in 2018, our people provided 
feedback that they wanted more support 
understanding how pricing is determined 
to support conversations with customers 
and ensure consistency. New guidelines  
on pricing and transparency have  
since been agreed and published.
Reinforcing our controls 
framework 
––During 2018, our businesses ran 
exercises to encourage a deeper 
understanding of the conflicts of interest 
that can occur in investment banking. 
These captured a more granular view of 
the potential situations that our people 
need to be aware of and actively manage. 
Over 100 workshops have been held to 
create an inventory of conflicts of interest 
that could arise within GB&M, bringing 
business lines and regions together. 
––We reviewed all our Global Banking 
locations to assess whether they are 
segregated from other business lines  
from the perspective of information 
control and managing conflicts of interest.
––We work in an environment where we are 
entrusted with privileged information that 
we have a critical responsibility to protect. 
It is vital that high levels of information 
controls are in place. Improvements in 
controls and procedures have been 
introduced during 2018. Over 31,000 
HSBC employees across all GB&M offices 
completed a bespoke training module on 
information control procedures.
For further information on our approach to conduct 
and the steps we have taken, see pages 37 to 39.
GB&M annual complaint volumes1
2018
2017
Global Markets2
201
273
Global Banking
330
417
Securities Services
360
349
Global Liquidity and 
Cash Management3
1,251
474
Total
2,142
1,513
1. A ‘complaint’ is defined as any expression of dissatisfaction, whether upheld/justified or not, from  
(or on behalf of) a former, existing or prospective customer relating to the provision of, or failure to  
provide, a specific product or service activity.
2. Global Markets also includes research.
3. GLCM excludes complaints relating to payment operations.
15
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Our Global Banking and Markets customers

How we listen to our customers
Acting on feedback
Given the direct access our customers have to their relationship managers, issues are usually resolved quickly. However, the 
customer engagement survey highlighted how some customers do not feel their feedback is addressed properly. In response, 
we are improving how we record feedback to ensure this is addressed in a more systematic way. 
We have three global strategic investment programmes underway focused on improving customer engagement and supporting 
sustainable business growth. These programmes, overseen by the GPB executive committee, are in the following table:
We serve the needs of high net worth 
and ultra high net worth individuals and 
families, helping them to grow, manage 
and preserve their personal wealth from 
generation to generation.
Building strong personal relationships 
with customers is critical in private 
banking. Our customer service teams, 
comprising relationship managers, 
investment counsellors, product and 
credit specialists, and wealth planners 
interact with customers on a daily basis, 
listening to and acting on feedback.
Customer satisfaction
In addition to this feedback, we conduct 
an annual customer engagement survey. 
In 2018, more than 800 customers 
shared their views on our people, 
products and services. Our overall 
satisfaction score fell from 8.4 to 7.6 
(based on a scale of 1 to 10), falling  
short of our threshold target of 8.0. This 
decline corresponded with a decline in 
our customers’ perception of whether  
we offer value for money, falling from 
91% to 76%.
However, our customers continue  
to be satisfied with our relationship 
management teams, scoring them  
8.4 out of 10, while 86% strongly agree 
that our portfolio reviews meet their 
financial needs, by providing a score  
of either 4 or 5 (on a scale of -5 to 5). 
Our Global Private Banking 
customers 
The three themes that have emerged 
from this survey, which we need to 
address are: 
––We need to improve perceptions of  
the quality of investment advice and 
products, which is falling short of 
expectations. 
––We need to keep pace with increasing 
customer expectations. We have been 
slow to implement a global digital 
proposition and our customers have 
experienced a higher number of 
instances than is acceptable where  
the service they have received from  
us left them feeling annoyed or  
let down. 
––We need to change outdated 
processes. Some of our customers  
feel our processes and procedures are 
cumbersome, and as a consequence 
we may not be easy to deal with.
Area of focus
Action
Advisory services
We are enhancing our advisory proposition through investment in technology that provides more sophisticated 
portfolio construction and risk analytics capabilities. This should help us to improve our investment processes 
and provide more proactive, well-informed advice. To support this, we increased the number of customer-
facing investment professionals and product specialists by 17% in 2018, and plan to make further investments 
in 2019, including a comprehensive training programme.
Digital
We are aware that our investment in digital wealth management capabilities has lagged behind those of  
our competitors. This has had an adverse impact on customer satisfaction. In 2018, we developed online  
and app-based capabilities that went live initially in the UK in February 2019 and which will be introduced  
to all our key markets during the year. A programme of continual enhancement will help ensure that these 
services remain competitive in the marketplace.
Global platform 
replacement
We are rationalising the number of IT platforms, replacing legacy systems with a core platform that houses  
a set of strategic solutions. This will facilitate global access to our flagship products and propositions, bringing 
a consistent customer experience across our main booking centres. The core platform is live in four locations, 
including Switzerland and the UK, and is scheduled to go live in Asia towards the end of 2019.
7.6
Overall satisfaction, adversely impacted by 
the perception of value for money (2017: 8.4)
16
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Customers

When things go wrong 
Encouraging our people to record  
all instances of complaints or negative 
feedback is essential to ensure we identify 
and take action on customer concerns 
and improve the services we provide.  
To support this, we are refreshing  
training modules to emphasise the 
positive benefits of effective complaint 
handling and including a requirement  
to accurately record complaints in 
individuals’ objectives.
In 2018, we received 550 complaints,  
a decrease of 5% on 2017. The significant 
majority (77%) related to service and 
administration issues, which include 
investment reporting, delay or failure  
to process customer instructions, 
dissatisfaction with postal or online 
services, and record updating. We 
recognise our investment reporting 
capabilities require improvement and  
we plan to make a number of changes  
in 2019. We are striving to reduce the 
GPB annual complaint volumes1
2018
2017
UK
46
70
Hong Kong
22
8
Rest of EMEA
276
294
Rest of Asia
 
13
10
US
193
196
1. A complaint is defined as any oral or written 
expression of dissatisfaction, whether justified or 
not, from, or on behalf of, a person about the 
provision of, or failure to provide, a financial 
service or a complaint determination.
potential for human error and frustration 
that can result from additional requests  
for updated personal and business 
information.
Product and performance issues were 
responsible for 9% of complaints. These 
doubled compared with 2017 and can be 
sensitive to the performance of individual 
funds and investments compared with 
market benchmarks. The third most 
common complaint related to pricing 
(8%). A common root cause was the 
challenge of applying certain customers’ 
special pricing terms consistently, and 
steps are being taken to reduce the 
scope for human error where possible.
In 2018, we resolved 504 complaints of 
which 219 were upheld. 
 
Spotlight: Conduct
One of our primary goals is to achieve  
fair conduct outcomes. Senior leaders  
set the tone and recently supported a 
series of workshops for colleagues in  
our European booking centres. These 
included real conduct case studies for 
senior management and supervisors  
to discuss with their teams, and will 
continue in 2019 to maintain the  
current level of focus.
Strengthening our controls 
Since 2015, we have published  
a number of conduct-related policies, 
including those addressing conflicts of 
interest, best execution, sales suitability, 
pricing, product governance, the 
supervisory framework and potentially 
vulnerable customers.
We continue to focus on ensuring these 
are embedded and applied consistently 
across the business. Ongoing work to 
strengthen controls includes:
––Sales suitability: We established sales 
quality assurance (‘SQA’) teams in  
2017, enabling us to focus on improving 
the quality and consistency of our 
investment advice. In 2018, more than 
3,200 trades were sample tested, 93% 
of which provided advice in line with 
our standards, with identified issues 
resulting in appropriate remedial action 
including customer contact where 
necessary. The SQA teams also perform 
thematic reviews, focusing on high risk 
scenarios. Where deviations from the 
standards or issues are identified, they 
are escalated and corrective action is 
taken, where required. 
––Supervisory framework: We defined a 
new framework in 2018, establishing 
clear standards and guidelines for 
individuals with responsibility for 
supervising customer-facing employees. 
––Product governance and pricing: We 
strengthened our product governance 
in 2018 with increased global oversight. 
Our product pricing principles, set by a 
global pricing policy and fair value 
exchange criteria for specific asset 
classes, are being embedded in all 
booking centres. 
Training our people  
for fair outcomes
Through the ongoing deployment of 
role-based learning, all customer-facing 
teams completed conduct training as 
required by their role in 2018. Building  
on this, we developed specific learning 
programmes for people managers  
and supervisors. This training develops 
capabilities to supervise, coach and 
develop relationship managers, 
investment counsellors and customer 
service executives within GPB. 
For further information on our approach to conduct 
and the steps we have taken, see pages 37 to 39.
17
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Our Global Private Banking customers

We are committed to improving customer 
experience through investments in 
technology. Here we highlight some  
of our areas of focus during 2018.
Improving customer experience
We are investing in technology to get  
to know our customers better and make 
use of these insights to provide them  
with clarity about their finances. Digital 
messaging is used to help our UK 
customers with financial difficulties 
manage their debt, including accessing 
debt consolidation services and charities 
online. Since launching this new service  
in November 2018, we have received 
more than 17,000 visits. 
For our global and institutional customers, 
we became one of the first banks in 2018 
to roll out Face ID login globally. The Live 
Chat service on HSBCnet is now available 
to more than 56,000 customers in six 
countries. It has consistently high customer 
satisfaction ratings, reaching 89% in July 
2018. We were also the first foreign bank  
in mainland China to allow customers to 
access services through WeChat.
Mobile banking experience
We have seen significant growth in 
mobile adoption rates for our retail 
customers, with the proportion of mobile 
active customers increasing by almost 
50% in 2018. We have introduced new 
mobile app features, such as remote 
cheque deposit in the UK and Canada, 
mobile chat in the UK, and International 
Education Payment Solution (‘IEPS’) in 
China, which allows customers to pay for 
their children’s international education 
fees from their mobile phones. 
Our PayMe mobile app allows HSBC 
customers and non-customers to send  
and receive money instantly and for free. 
PayMe has approximately 1.5 million 
users with over two million payments 
made each month, making it the number 
one peer-to-peer payments app in Hong 
Kong, according to the Hong Kong 
Monetary Authority. 
In 2018, we launched new mobile apps in 
five markets, with improved functionality 
such as biometric login and the ability  
to put temporary blocks on cards. As  
we continue our roll-out of new apps, 
approximately 20% of active mobile users 
still use the legacy app, which lacks some 
features users expect. This can be seen 
through low Apple App store ratings, 
where our legacy mobile app scores an 
average 1.9 out of 5 compared with the 
new app scoring 4.8 in the UK and  
4.7 in Hong Kong.
Our new Business Express mobile app 
helps enable our commercial customers  
to stay on top of their business finances 
any time, anywhere. Key features include 
biometric access through fingerprint  
or facial recognition, fast and accurate 
tracking of recent incoming funds, 
outgoing payments as well as all trade 
transactions, plus instant help from the 
chatbot Ask Amy 24/7. New features will 
be added, including notifications and 
faster payment journeys. 
Machine learning/AI
Artificial intelligence (‘AI’) and machine 
learning are becoming easier to use 
through our adoption of cloud computing, 
open source frameworks and commercial 
solutions. AI is being used to better 
segment customers for financial crime 
detection and to investigate potential 
crime faster and to a higher quality. 
Machine learning is at the heart of our 
intelligence-led financial crime models, 
where it is being trialled to improve 
real-time detection rates and reduce  
false positives. AI is also being used 
increasingly within our RBWM business  
to determine customer needs, and to 
enable us to make relevant offers to our 
customers at the right time for them.
For our retail customers, we introduced 
machine learning-enabled chatbots in 
mainland China, Hong Kong and the  
US to handle basic questions so that 
customers would not need to wait for  
a live agent to be available. 
For our global and institutional clients,  
our virtual assistant uses machine learning 
to answer customers’ questions. It is 
available in five languages. 
Investing in digital
45%
1
of our retail 
customers are 
digitally active 
(2017: 41%)
60%
of our commercial 
banking customers use 
our internet banking
1. Digital metrics include the following markets: the 
UK (excluding M&S Bank and John Lewis Finance 
customers), Hong Kong (excluding Hang Seng 
customers), Mexico, Malaysia, Singapore, UAE, 
mainland China, Canada, Australia, the US, 
France, India, Indonesia, Turkey, Egypt, Argentina 
and Taiwan. Digitally active customers are defined 
as the percentage of customers who have logged 
on to HSBC digital channels at least once in the 
last 90 days. 
Customer developments  
across all global businesses
Our investment in technology
18
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Customers

Cybersecurity
We operate in an increasingly sophisticated 
and hostile cyber threat environment. In 
response, we are investing in business 
and technical controls to help prevent, 
detect and react to these cyber threats.   
We are strengthening our controls to 
help protect against advanced malware, 
data leakage, infiltration of payment 
systems and denial of service attacks  
as well as enhancing our ability to  
detect and respond to cyber-attacks.  
An important part of our defence 
strategy is ensuring our employees 
remain cyber-aware and know how to 
report incidents. We continually evaluate 
the threat environment for the most 
prevalent attack types and their potential 
outcomes in order to determine the most 
effective controls. 
We operate a three lines of defence 
model, aligned to the operational risk 
management framework, to identify, 
report and manage cyber risks within  
the organisation. Global business and 
function risk owners in the first line are 
accountable for identifying, owning and 
managing the cyber risk. They work with 
control owners to help ensure controls 
are in place to mitigate issues, prevent 
risk events occurring and resolve risk 
events if they do occur. These controls 
are executed in line with policies 
produced by the second line information 
security risk teams and are overseen by 
the third line – the independent Internal 
Audit function. 
Cyber risk and control effectiveness  
was reviewed 11 times at non-executive 
Director level, including by the Board, 
Group Risk Committee and Group Audit 
Committee. It is also reported across the 
global businesses, functions and regions 
to help ensure appropriate visibility  
and governance of the risk and its 
mitigating controls.
We participate in several industry bodies 
and working groups to discuss cyber 
risks, including the following:
––attendee of key banking association 
cyber working groups in all regions, 
including groups run by the Association 
for Financial Markets in Europe and the 
Hong Kong Association of Banks;
––contributor to the UK’s National Cyber 
Security Centre, specifically through 
the Cyber Security Information Sharing 
Partnership initiative;
––member of the following three chapters 
of the Financial Services Information 
Sharing and Analysis Center: the  
US, UK and Europe, and Asia-Pacific 
chapters; 
––member of the Institute of International 
Finance cyber working group;
––contributor to the Cyber Security 
Industry Group, a financial services 
industry-led information exchange 
forum in the UK; and
––member of government-led computer 
emergency response teams in major 
markets, including the UK, US and 
Hong Kong.
Operational resilience
Operational resilience is the ability  
to adapt operations to continue 
functioning when – not if – circumstances 
change. We have a clear strategic 
approach to operational resilience 
considered from three perspectives,  
while putting the impact on our 
customers and colleagues at the centre  
of our thinking: how we architect, design 
and build systems and services; how  
we operate, run and monitor our control 
environment; and how we respond and 
recover in the event of disruption.  
Data privacy
We are committed to protecting the 
privacy of data we hold and process,  
in accordance with the laws and 
regulations of the geographies we operate 
in. We are focused on embedding a 
culture designed to ensure data privacy  
is at the heart of our organisation.
In 2018, there were significant changes  
to EU data privacy laws, with the General 
Data Protection Regulation (‘GDPR’) 
coming into effect across the EU, while 
new data privacy legislation came into 
force in some non-EU jurisdictions. The 
introduction of the GDPR provided us with 
an opportunity to review and reinforce our 
data privacy policies and controls across 
the Group, giving customers, employees 
and stakeholders more transparency and 
control over how we use and manage 
their information. A dedicated programme 
of work was mobilised to execute and 
embed GDPR requirements within HSBC 
ahead of its coming into force. We 
continue to develop and focus our privacy 
capabilities in areas such as safeguards, 
privacy impact and risk assessments, staff 
training, education and raising awareness. 
Data privacy is regularly reported at 
multiple Group-level governance forums, 
which include Board level representation 
to help ensure appropriate challenge  
and visibility among senior stakeholders. 
In addition, data privacy governance 
structures have been established within 
the Group. We continue to work towards 
embedding ownership and accountability 
of data governance across all businesses 
and functions in an effort to ensure 
effective management of risks.
Increasing complexity in the matrix  
of global data privacy laws, recent 
developments in data localisation 
requirements and the emergence of  
new data-driven technologies continue  
to challenge the banking industry. They 
also bring opportunities to serve our 
customers better, and we recognise that 
data privacy and concepts such as privacy 
by design are fundamental to achieving 
this. We continue to work closely with 
data privacy regulators, industry bodies 
and external stakeholders around the 
world to stay abreast of regulatory 
developments in this area. 
Protecting our customers’ data 
19
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Customer developments across all global businesses

By region
(%)
Asia
34
42
17
4
1
1
27
23
12
44
49
30
21
24
23
28
7
7
6
8
32
17
25
18
1
Europe
Latin 
America
Middle 
East
North
America
≤29
30–39
40–49
Key
50–59
≥60
Senior leaders (GCB 0–3)
(%)
British
35
6
3
3
9
Chinese
Indian
French
Australian
All employees
(%)
Chinese
22
16
7
3
17
Indian
British
Mexican
Malaysian 
All employees
0–5 years
55%
6–10 years
17%
11–20 years
19%
21–30 years
6%
≥31 years
3%
Senior leaders 
(GCB 0–3)
0–5 years
51%
6–10 years
17%
11–20 years
21%
21–30 years
8%
≥31 years
3%
Our relationship
Our people at HSBC span many 
cultures, communities and continents. 
We want to build trusted relationships, 
where our people feel empowered  
in their roles and inspired to grow.  
We help our leaders set the tone  
by listening and valuing the  
behaviours that get a job done  
as much as the outcome. 
We understand the importance  
of building a diverse and inclusive 
workforce, valuing individuals and  
their contribution. This allows us to 
better represent our customers and  
the communities we serve. The path  
to achieving the healthiest human 
system is being defined by our people 
in conversations around the world.
At a glance 
Age diversity
Top five nationalities1
Employee profile
 Employees
We have a total workforce of 235,000 full- and part-time 
employees, working across 66 countries and territories. 
We are working to create the right environment to help 
enable everyone to fulfil their potential. 
Employee tenure
1. Data excludes unspecified nationalities.
20
HSBC Holdings plc Environmental, Social and Governance Report, April 2019

Gender balance – all employees
Male (115,391)
48%
Female (125,276)
52%
(2017: 52%)
(2017: 48%)
Gender balance – senior leaders
Male (6,887)
72%
Female (2,701)
28%
(2017: 27%)
(2017: 73%)
Snapshot survey results
Developing our people
Diversity and inclusion
Awards
HSBC employees 
were named on the 
following:
 
Financial Times’ 
OUTstanding list
 
Financial Times’ 
EMpower list
 
Financial Times’ 
HERoes list
Exchange results
Training statistics at HSBC
74%
feel able to speak up when 
they see behaviour they 
consider to be wrong
(2017: 74%)
66%
would recommend 
HSBC as a great 
place to work
(2017: 64%)
6.2 million
Training hours
(2017: 7.2 million)
2.8 days
Training days per FTE
(2017: 3 days) 
2,000
Exchange meetings took 
place to discuss the healthiest 
human system
30,000
employees have taken part 
in these sessions
21
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
At a glance

Listening to  
our people  
How we listen to our people
Understanding how our people feel 
about HSBC is vital. It helps us ensure 
we are giving them the right support to 
achieve their potential and to serve our 
customers well. 
We capture the views of our people on  
a range of topics, such as our strategy, 
culture and working environment, through 
our employee survey, Snapshot. Results 
are presented to the Group Management 
Board and relevant executive committees. 
This allows us to take action based on  
the feedback. The adjacent table shows 
selected results from our 2018 survey.
Snapshot survey
We track employee advocacy by asking 
whether our people would recommend 
HSBC as a great place to work. Currently, 
66% of our people would recommend 
HSBC, an increase from 64% in 2017.  
We recognise there is more to do and  
we are aiming to improve this measure  
by three points each year through to  
2020. Analysis in 2018 showed us that 
trust in leadership, career development 
and recognising our people for their 
behaviour and performance drive a 
positive response to this question. 
In late 2018, we expanded our Snapshot 
survey to look at behaviours by asking  
if people see others demonstrating  
our values. The feedback allows us to 
identify areas for improvement and  
take meaningful action in 2019. 
We see that 74% of our people feel able  
to speak up when they see behaviour that 
they consider to be wrong. It tells us that 
our speak-up channels are working, but  
we know there is further work to be done. 
Exchange 
Our Exchange forums provide a place for 
our people to share their open and honest 
views. Typically, these are meetings held 
without an agenda, meaning people can 
discuss what matters most to them. We 
know that when people participate in 
Exchange meetings, they feel more able 
to speak up, have more trust in leadership 
and report higher levels of well-being. 
More than half of our people took part  
in an Exchange meeting during 2018. 
Over 2,000 Exchange meetings were 
arranged to discuss our ambition to  
create the healthiest human system in our 
industry. These involved 30,000 employees 
taking part and sharing what it means for 
them. It is clear from the feedback that we 
need to begin with frank, open and honest 
conversations about what it feels like to 
work at HSBC. We will use this feedback  
to build out action plans in 2019 and ensure 
that the necessary steps are taken to  
make a positive change. 
Selected results from Snapshot survey 
2018
2017
I am seeing the positive impact of our strategy
67%
65%
I feel confident about HSBC’s future
75%
72%
I trust the senior leadership in my area
64%
66%
I believe that the senior leadership in my area makes decisions that 
take people like me into consideration
53%
53%
I feel proud to work for HSBC
76%
76%
I would recommend this company as a great place to work
66%
64%
Conditions in my job allow me to be as productive as I can be
65%
58%
I feel able to speak up when I see behaviour which I consider to be wrong
74%
74%
I believe HSBC is genuine in its commitment to encourage 
colleagues to speak up
74%
70%
Spotlight: Employee recognition
Embedding a culture that recognises great behaviour is important to us. Our global recognition programme At Our  
Best allows people to recognise colleagues who live up to our values. Employees receive recognition points from their 
colleagues, which can be redeemed against a wide range of goods. In 2018, more than 720,000 recognitions were made  
to a total value of $8.4 million. In 2018, we focused on HSBC sustainability, resulting in over 65,000 employee recognitions. 
Stories were shared as inspirational case studies on our intranet, HSBC NOW. These included how our people were 
championing greener business, supporting a greener environment and volunteering in the local community. 
More than
50%
of our people took part in an Exchange 
meeting during 2018
22
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Employees

When things go wrong 
Spotlight: Conduct
Having a culture where our people  
feel able to speak up is important.  
Our people are encouraged to raise 
concerns about wrongdoing or unethical 
conduct through their normal reporting 
and escalation channels. However, we 
understand that in some circumstances 
people prefer a more discreet way to 
raise their concerns.  
Whistleblowing 
HSBC Confidential is a global platform 
that allows people to raise concerns 
outside of our normal reporting and 
escalation channels in confidence  
and without fear of retaliation. This  
is available to all of our people, past  
and present, in all global businesses, 
functions and entities.
Within this platform, we have  
multiple channels to raise issues,  
including telephone hotlines, online 
portals and email. A broad range of  
cases, covering a range of severity  
levels, are dealt with each year. We also 
monitor an external email address for 
concerns about accounting, internal 
financial controls or auditing matters  
(accountingdisclosures@hsbc.com).  
In 2019, we plan to expand our use of  
an independent third-party supplier to 
manage our 24/7 reporting hotline and 
ensure the service is available in the 
Group’s key local languages. 
We rely on our people to deliver fair 
outcomes for our customers and make 
sure we act with integrity in the financial 
markets. A high standard of personal 
conduct is critical for our ability to live  
up to this commitment and ensure  
a healthy working environment for  
our people. We actively manage 
misconduct by taking any necessary 
action, up to and including dismissal.  
We monitor and report cases on  
a regular basis to management 
All whistleblowing concerns are subject 
to an independent investigation, which  
is carried out by teams trained to handle 
sensitive cases. These include human 
resources, compliance, legal, information 
security and internal audit. Cases are 
allocated depending on the concerns 
raised. In 2018, 74% related to people, 
12% to security and fraud, 11% to 
compliance, and the remaining 3% to 
other categories. Following investigation, 
we take appropriate action if necessary, 
including disciplinary action or 
adjustments to variable pay and/or 
performance and behaviour ratings.  
We learn lessons and change our 
processes where needed. 
HSBC does not condone or tolerate 
retaliation against people who raise 
concerns and we strictly enforce  
our policy relating to this. Senior 
management are made aware of cases 
alleging retaliation and the outcome or 
action taken. Making malicious or false 
claims is incompatible with our values 
and such instances are taken seriously. 
Our Group Audit Committee  
has responsibility for oversight of 
whistleblowing arrangements and 
receives regular updates on the status  
of whistleblowing case volumes,  
themes and outcomes.
committees. In 2019, we aim to develop 
our reporting and analysis of themes and 
action taken.
Bullying and harassment are not 
tolerated at HSBC and we have strict 
processes to manage these types of 
behaviour. At the end of 2018, our Group 
Chief Executive addressed the topic 
directly with senior leaders. In 2019,  
we aim to centralise the monitoring of 
any bullying and harassment cases.
2,068
Number of cases raised (2017: 1,585)
34%
Substantiated cases closed (2017: 30%)
23
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Listening to our people

Holdings Board
Group Management
Board
Combined executive
committee and 
direct reports1
Senior
leadership2
Senior leadership 
RBWM
Senior leadership 
GB&M
Senior leadership 
CMB
Senior leadership 
HOST
Senior leadership 
GPB
All employees
89%
11%
36%
64%
26%
74%
72%
28%
69%
31%
80%
20%
72%
28%
69%
31%
74%
26%
48%
52%
9
5
148
51
6,887
2,701
752
331
2,398
608
645
245
387
174
652
226
115,391
125,276
17
2
Gender diversity statistics
Male
Female
Key
A healthy and  
diverse workforce 
At HSBC, diversity is not just about a 
particular demographic group. It is about 
who we are, what we have learned and 
the experience we have gained. We seek 
to reflect the diversity of the markets we 
serve, not only in our people but also  
by encouraging diversity across our 
customers, communities and suppliers.
We believe in an enterprise-wide 
approach to diversity and inclusion.  
In 2018, we made good progress in 
updating our global procurement 
processes to improve supplier diversity 
and will continue this in 2019. We 
conducted a refresh of our brand to 
include inclusive imagery and principles 
so our customers and people can see 
themselves in HSBC. We have introduced 
talking cash machines and sign language 
services on smartphones to provide 
‘barrier-free banking’ and insurance 
products for same sex couples in Hong 
Kong. We know there is still more to do. 
Gender balance
Gender balance in leadership is an area 
where we are making progress but 
recognise the need to improve. We have 
signed up to the 30% Club campaign 
commitment to reach 30% women in 
senior leadership roles by the end of 2020. 
In 2018, 28.2% of our senior leadership 
were women, above our goal of 27.6%.  
In 2019, we are aiming for 29%. 
To help improve gender balance in  
senior roles we provide mentoring and 
sponsorship opportunities for talented 
women. We extended our Accelerating 
Female Leaders programme in our  
GB&M business to include our CMB and 
GPB businesses. Through sponsorship,  
the programme builds visibility and 
connectivity for Director-level female 
talent with leaders from across the Group. 
In 2018, 28.2% of our senior leadership  
were women, above our goal of 27.6%.
Our employee networks
Our seven global employee networks and 
our HSBC Communities discuss issues our 
people care about and challenge us on 
where we could be doing better. We have 
more than 140 groups with over 80,000 
participants. The networks focus on 
gender, age, ethnicity, LGBT+, faith, 
working parents and carers, and ability 
(including mental health). Our HSBC 
Communities focus on a variety of 
common interest topics including flexible 
working, military and veterans, and 
Chinese culture. These groups play an 
important role in helping us make progress. 
Our largest global network, with over 
48,000 participants, is Balance, which 
works to improve gender balance.
In 2018, we introduced a global 
management structure for our LGBT+ 
network, Pride, to help network growth 
and share best practice.
Spotlight: Gender pay gap 
Gender pay is an area of particular focus in the UK with the introduction of 
the Gender Pay Gap (‘GPG’) Reporting regulations. We have complied with  
the regulations and reported our 2017/2018 GPG. Our UK gender pay gap is 
driven by the gender imbalance within our businesses and functions. There  
are fewer women in senior leadership roles, meaning that we have more men 
earning higher salaries. A higher proportion of women work in more junior  
roles or work part-time hours. 
We are committed to improving gender balance and are taking a number  
of specific steps that we expect to have a positive impact in the UK over  
time, including:
––driving better gender balance at all levels in the organisation;
––developing female talent to strengthen the leadership pipeline; 
––supporting families and flexibility; and 
––retaining female talent.
We are confident in our approach to pay and where we have identified pay 
differences that cannot be explained, we have made appropriate adjustments.
1. Combined executive committee and direct reports 
includes HSBC executive directors, Group Managing 
Directors, and their direct reports (excluding 
administrative staff) plus Company Secretary.
2. Senior leadership refers to employees performing 
roles classified as 0, 1, 2 or 3 in our global career 
band structure.
24
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Employees

Well-being and developing 
our people  
Employee well-being
A healthy and happy workforce  
is essential for a positive working 
environment. Our priorities for our 
people are mental health, flexible 
working and financial well-being. 
Mental health
We want HSBC to be an environment 
where people feel they can be open about 
their mental health and concerns. While 
we have taken action, we know there is 
more to do. 
In October 2018, we held over 75 events 
to support World Mental Health Day. 
This included a video interview between 
John Flint, our Group Chief Executive, 
and Brian Heyworth, our Global Head of 
Client Strategy, sharing their perspectives 
on mental health at HSBC. This has 
become one of the most viewed internal 
videos and helped open the conversation 
within HSBC.
We offer an employee assistance 
programme so our people have free 
access to external expert assistance and 
confidential advice when they require it, 
such as after suffering a bereavement or 
personal difficulty. We advertise these 
third-party programmes locally so our 
people have the available information  
to get the best support. 
We use our learning platform, HSBC 
University, to publish articles and 
resources relating to mental health  
from industry-leading bodies. 
In 2019, we will start to provide 
widespread mental health education  
and support to our people, starting with  
a programme of mental health education 
for all managers. Our focus will be on 
spotting the signs of mental ill-health, 
having open conversations and 
signposting the right support. This will  
be supported by local and Group-wide 
awareness campaigns, recognising that 
we all have a part to play to create a  
more open environment. 
Flexible working
Our 2017 global well-being survey 
confirmed that 49% of our people work 
flexibly, and those who do are more 
positive about their general well-being. 
We know this is an area where people 
want more support, so during 2018 we 
invested in technology and infrastructure. 
We expanded an OpenWork concept, 
which makes it easier for our people to 
work flexibly across 27 cities covering 
approximately 75,000 staff. This helped 
more of our people make positive choices 
that meet their needs both inside and 
outside of work. 
One of our HSBC Communities, Flex, 
which supports flexible working, has  
run global events on topics such as job 
sharing. These included an event on 
International Men’s Day, which focused 
on male employees and the mental health 
benefits of flexible working. Our priority 
for 2019 is to implement consistent 
flexible working principles across HSBC.
Financial well-being
In 2018, we re-launched our employee 
assistance programmes, to include 
financial support. In addition, multiple 
countries have run financial capability 
events, including Mexico, UAE and the UK.
In 2019, we are enhancing the content and 
roll-out of our events and education as we 
recognise there is further action needed. 
For more information on how we are working to 
increase financial capability, see pages 11 and 34. 
Learning and development
Talent development 
We recognise we must invest in our 
people to continue to thrive. 
The International Manager Programme is 
one of our flagship talent programmes. 
With approximately 300 international 
managers currently deployed across  
46 countries, the programme provides 
resourcing flexibility and helps us develop 
a strong pipeline of home-grown future 
leaders for our most critical positions. 
International mobility is key to future 
success. We offer international 
secondments and transfers to our wider 
employee base, which enhances career 
development opportunities, and helps to 
attract, develop and motivate our people 
who demonstrate high potential.
Expanding HSBC University 
The opportunity to develop is one of  
the most important factors affecting  
how people feel about HSBC. We 
celebrated the first anniversary of our 
home of learning, HSBC University,  
in November 2018. Thousands of 
resources are available through this 
platform, which receives more than 
52,000 visits per month. 
HSBC University strengthens how  
we learn and lead through new 
programmes, resources and premises. 
We have launched HSBC University 
regional hubs at our offices in Dubai  
and the HSBC UK headquarters in 
Birmingham, providing opportunities  
for our colleagues, customers and 
community groups to come together  
to learn, develop and connect.
We have expanded our management  
and leadership development with new 
programmes, including Leading with 
Impact for senior leaders, and Leading 
Myself for those without a team. We have 
developed our Essentials programme to 
support people managers and strengthen 
their coaching and hiring skills. In 2018, 
600 leaders completed the Leaders as 
Teachers programme and put their skills 
into practice by supporting colleagues’ 
training through business programmes, 
Leadership Essentials and the Accelerated 
Development Programme.
We are committed to helping our  
people prepare for the future of work.  
We launched digital skills training, and  
our Leading Myself programme explored 
areas including personal resilience, 
collaboration and communicating with 
impact. This is a continued area of focus  
as there is more to do. 
During 2018, we formed partnerships with 
external providers, including LinkedIn 
Learning and Coursera, and introduced 
learning modules to raise awareness of 
our sustainability challenges. 
For further details on how we are building 
future skills, see page 34.
25
Additional information
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Supporting  
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Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Europe
56%
Asia
28%
Americas
13%
Middle East, North 
Africa and Turkey
3%
Target
Progress
Progress
Target
At a glance
Our relationship
Our actions have an impact on the 
communities where we do business 
and the wider environment. We want to 
ensure we are helping economies grow 
sustainably, and we choose to direct 
our resources, including time, people 
and capital, to helping the global 
transition to a low-carbon economy.
We have shown progress against our 
targets in sustainable finance, and 
have set out how we are partnering 
with our customers to assist with the 
transition to a low-carbon economy. 
We are also engaging with our 
customers on transition risk, and 
embedding climate risk within our  
own risk management practices.  
We understand that it is important  
to report disclosure on both climate-
related opportunities and risks to our 
stakeholders, and include our second 
disclosure under the Task Force on 
Climate-related Financial Disclosure 
(‘TCFD’) in this section.
We recognise that technology is 
developing at a rapid pace in the 
communities where we operate,  
and that a range of new and different 
skills are now needed to succeed in  
the workplace. We continue to focus 
around employability and financial 
capability resulting in global 
programmes and activities that address 
this in our diverse global communities. 
We continue to prioritise providing  
a rich variety of volunteering 
opportunities for our employees  
globally and continue to invest in  
the communities we operate in. 
 
 Supporting sustainable growth 
We aim to grow our business in a sustainable way  
with a focus on moving to a low-carbon economy  
to protect our planet, recognising our duty to support  
the communities in which we operate.
 
Sustainable finance
Progress against our targets
Awards
GlobalCapital Sustainable 
and Responsible Capital 
Market Awards 2018
–– Most Impressive Financial 
Institution Green/ 
SRI Bond Issuer 
–– Most Impressive Investment 
Bank for Asia Pacific Green/
SRI Capital Markets
Euromoney Awards  
for Excellence 2018
–– Asia’s Best Bank for 
Sustainable Finance
Extel  
Survey 2018
–– No.1 Integrated Provider  
of Climate Change 
$100bn
of sustainable financing  
and investment to be  
provided and facilitated by 2025
100%
of our electricity will be  
from renewable sources  
by 2030
>2,300
employees given 
sustainability training 
(2017: 1,300)
$28.5bn
cumulative progress  
since 2017
29%
signed renewable 
electricity from power 
purchase agreements
(2017: 27%)
Our engagement in 2018
26
HSBC Holdings plc Environmental, Social and Governance Report, April 2019

Sustainable  
finance 
We aspire to be a global partner for  
the public and private sector by helping 
governments and companies achieve 
their sustainability goals, and enable a 
transition to a low-carbon economy.
Supporting our customers
We are embedding sustainability into 
the products and services we offer to 
customers, including access to capital 
markets, lending, transaction banking, 
advisory services, and investments. We 
are one of the biggest issuers for green, 
social and sustainable (‘GSS’) bonds. In 
2018, we were the number one issuer of 
sustainable bonds globally and number 
two for GSS bonds overall, according  
to data provider Dealogic. In 2018, we 
were recognised by Euromoney as the 
Best Bank for Sustainable Finance in 
Asia for our efforts to innovate products 
to address customers’ evolving needs.
Extel ranked us top for climate change 
research for a fifth consecutive year  
in 2018. In addition, our businesses 
provided a number of reports to help 
inform customers on sustainability 
considerations, including Low-carbon 
transition scenarios: Exploring scenario 
analysis for equity valuations by HSBC 
Asset Management, and Sustainability 
guidebook for treasurers by Global 
Liquidity and Cash Management.
We held over 2,500 customer meetings 
in 2018 for our largest clients in GB&M 
and CMB to discuss sustainable finance 
options and opportunities. We are 
building the knowledge and capabilities 
of our people through continued training 
and engagement. We introduced a  
new series of learning modules on 
sustainability through our online HSBC 
University for all employees, as well as 
tailored sustainability training sessions 
for key customer-facing employees and 
people in risk management roles. More 
than 2,300 employees participated in 
targeted sustainable finance training.
Driving market innovation 
We look for opportunities to develop 
and expand the market for sustainable 
finance, and contributed to a number of 
market precedents in 2018. HSBC acted 
as sole green structuring adviser for the 
Republic of Indonesia’s green Islamic 
bond, known as a sukuk, which marked 
the first sovereign green sukuk (see the 
case study on the following page).
We played an active role in the 
development of the Green Loan 
Principles introduced in 2018 and 
engaged with customers to provide 
lending that conforms to these industry-
recognised guidelines. We acted as  
the sole green finance adviser and joint 
mandated lead arranger and bookrunner 
for the first green loan in Hong Kong. We 
also launched a lending scheme in Hong 
Kong that allows customers to earn cash 
rewards for making carbon savings.
Demonstrating leadership
We are helping lead the development of 
the sustainable finance market through 
our own actions. In 2018, we issued the 
world’s first sukuk linked to the United 
Nation’s Sustainable Development  
Goals (‘SDGs’) with the help of our 
Islamic banking arm in Malaysia. See 
www.hsbc.com/investors/fixed-income-
investors/green-and-sustainability-bonds 
for the impact reports related to our 
green and sustainability bonds. We 
published 25 reports in the inaugural 
year of HSBC’s Centre of Sustainable 
Finance, which was launched in 2018  
to provide sustainability-related thought 
leadership and innovation. These efforts 
aim to strengthen understanding and 
debate across the financial industry  
and among other stakeholders. 
Further opportunities
We recognise the potential we have as a 
global universal bank to help facilitate the 
transition to a low-carbon economy and 
support other sustainability goals. As  
we continue to develop our programme  
of initiatives, we see particular 
opportunities to help our customers 
embed sustainability throughout their 
supply chains and to work with more 
carbon-intensive industries to respond  
to climate change challenges.
Our HSBC Navigator survey, which  
polls over 8,500 businesses in 34 
markets on the global business 
environment, included a focus in 2018 on 
trade and sustainability. Nearly one-third 
of businesses surveyed plan to make 
sustainability-related changes to their 
supply chains within the next three years. 
The survey identified financial gain, cost 
efficiency and sustainability goals as 
primary drivers for these changes. We 
aim to expand our efforts to provide 
working capital and term lending 
solutions that facilitate sustainability 
practices along supply chains.
Sustainable business
#2
Dealogic ranking for green, social and 
sustainability bond issuer, both globally  
and in Asia in 2018
27
Additional information
A responsible  
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Supporting  
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Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Case study: The first green loan for UK 
commercial buildings
Direct greenhouse gas emissions from buildings in the UK 
account for 19% of the country’s total, and improving the 
energy efficiency within this sector will be key to the UK 
meeting its obligations under the Paris Agreement. That  
is why green and retrofit buildings are critical to cutting 
greenhouse gases. We have been working with Argent,  
a UK property developer, on this issue. In 2018, HSBC UK 
acted as the green coordinator, mandated lead arranger  
and hedging counterparty for the first green loan for UK 
commercial buildings. The £400 million green loan facility, 
which is helping Argent fund the development of two office 
buildings, is compliant with the Loan Market Association’s 
and Asia Pacific Loan Market Association’s Green Loan 
Principles. The offices have been designed with 
sustainability features that will bring the carbon footprint 
down to approximately 50% of similar offices in the country 
and are both targeting BREEAM Outstanding – one of the 
highest levels of green building certification globally.
As part of our drive to deliver growth from areas of strength, we are committed to helping our clients transition  
to a low-carbon economy, supporting the achievement of the SDGs, and supporting positive societal impacts. 
Cumulative progress through 2018
Since the start of 2017, we have achieved $28.5bn of our commitment to provide and facilitate $100bn of sustainable financing 
and investment by 2025. A data dictionary, including detailed definitions of contributing activities, may be found on our website 
www.hsbc.com/our-approach/measuring-our-impact.
Facilitation
Financing
Investments
We provide advisory services  
to facilitate the flow of capital  
and to provide access to capital  
markets. Products include: green,  
social and sustainable bonds;  
debt capital markets; and equity  
capital markets.
We provide lending for specific  
finance activities. Products include  
project finance (e.g. financing of renewable 
infrastructure projects),  
and green loans (e.g. financing of  
eligible green products).
We provide investments into  
defined socially responsible  
investment (‘SRI’) and  
low-carbon funds.
Cumulative progress*  
($bn)
21.4
Cumulative progress*  
($bn)
5.8
Cumulative progress*  
($bn)
1.3
2018
2017
10.3
11.1
2018
2017
0.5
5.3
2018
2017
0.2
1.1
* PwC provided limited assurance over progress towards the $100bn sustainable finance commitment as at 31 December 2018 in accordance with International 
Standard on Assurance Engagement 3000 (Revised) ‘Assurance Engagements other than Audits and Reviews of Historical Financial Information’. This can be 
found on our website www.hsbc.com/our-approach/measuring-our-impact.
Sustainable business continued
Case study: The first green sovereign sukuk
In 2009, the Republic of Indonesia was among the  
first countries to voluntarily set carbon emission targets 
during international negotiations in Copenhagen. Under 
the Paris Agreement, the country pledged to reduce 
emissions by up to 41% by 2030 and recently adopted  
the green sukuk framework to support its commitment. 
To fund climate mitigation and adaption projects in a 
broad range of sectors, as well as to demonstrate its 
commitment to the Paris Agreement, Indonesia issued 
the world’s first green Islamic bond, known as a sukuk, 
for $1.25 billion in February 2018. HSBC acted as joint 
lead manager, joint bookrunner and sole green 
structuring adviser. This transaction represented the  
first sovereign green sukuk, the first international green 
offering by an Asian sovereign and the first Asian 
sovereign green bond focused on Paris Agreement 
ambitions. 
28
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Supporting sustainable growth | Sustainable finance

The transition to a low-carbon economy 
will occur over a multi-year horizon and  
it will take time for sectors currently 
dependent on fossil fuels to adapt. While 
it is acknowledged there should be a 
significant and immediate reduction in 
the use of coal to generate power, other 
traditional sources of energy, such as oil 
and gas, have a longer term role during 
the transition. Developing countries may 
also need more time to adjust as they 
balance sometimes competing 
sustainable development goals.
In this context, we are working to  
further understand the specific risks  
and opportunities climate change 
presents to our customers, and we are 
developing our knowledge and capacity 
to support their transition towards a  
more sustainable future. We are doing  
this through our engagement in the 
Energy Transitions Commission,  
thought leadership articles published  
on the Centre of Sustainable Finance  
(www.sustainablefinance.hsbc.com),  
and other industry engagement.
In 2018, we developed a transition  
risk questionnaire with some of our 
customers to improve our understanding 
of their climate transition strategies.  
This is helping us to identify which 
customers need to adapt rapidly to 
climate-related risks, and spot potential 
business opportunities. In time, this 
information can be incorporated into an 
initial assessment of transition risk within 
our credit risk management processes. 
We plan to roll the questionnaire out 
more widely in 2019. We have also 
embedded climate risk more broadly  
in our risk management processes.  
More information can be found in  
the risk management section of  
our TCFD disclosure on page 30.
Another important element of our climate 
risk management is covered via our 
sustainability risk management strategy. 
Sustainability risk is broader than climate 
risk. We define it as the risk that financial 
services provided to customers by the 
Group indirectly result in unacceptable 
impacts on people or the environment. 
Group Sustainability Risk, which is part of 
the Global Risk function, is responsible for 
managing our sustainability risk policies 
(covering agricultural commodities, 
chemicals, defence, energy, forestry, 
mining and metals, UNESCO World 
Heritage sites, and Ramsar-designated 
wetlands) and our application of the 
Equator Principles. As with climate risk 
management, we seek to partner with  
our customers to improve their operating 
standards. For more information on  
how we manage sustainability risk, see 
www.hsbc.com/our-approach/risk-and-
responsibility/sustainability-risk.
Our energy policy
Our approach is to support our 
customers to transition to a low-carbon 
economy while limiting the financing of 
high-carbon intensity energy projects. In 
2018, we updated our energy policy and 
set out our position with respect to new 
project financing of coal-fired power, 
Our approach to climate risk management 
 
Engaging with our customers on palm oil
Palm oil is the world’s main vegetable oil. It requires less  
land per output than other vegetable oils, and its production 
can bring wide economic benefits. However, when produced 
unsustainably, palm oil can lead to deforestation, resulting  
in threats to endangered species, social conflict and  
climate change. 
We have worked closely with our customers to support 
certification through the Roundtable on Sustainable Palm  
Oil (‘RSPO’), an independent organisation that sets standards 
of good practice against which companies are independently 
certified. Internally, we have progressively raised our own 
policy standards. In 2014, we decided we would only finance 
customers that were already partly certified under RSPO and 
aimed to complete certification by the end of 2018. Customers 
also need to provide evidence of independent verification 
under their commitments to ‘No Deforestation, No Peat, and 
No Exploitation’ (‘NDPE’). Our agricultural commodities policy 
is available online at www.hsbc.com/our-approach/risk-and-
responsibility/sustainability-risk.
A number of our customers have chosen to operate 
sustainably as a result of our engagement, including  
11 customers that have introduced NDPE policies  
following discussions with HSBC. At the end of 2018: 
––We financed 22 customers engaged in palm oil  
production that have either met our policy or will do so 
shortly. Several customers are in the final stages of full 
certification, managing external delays and resource 
constraints to meet our specific requirements.
––We have 31 customers who have operations in the palm  
oil sector, but where we do not finance this part of their 
business. We have engaged with those customers and 
many operate to or are working towards good practice.  
––We have 19 customers that do not meet our policy,  
and we intend to discontinue the relationship when  
existing loans have been repaid.  
greenfield projects in the oil sands, 
offshore Arctic drilling and due diligence 
requirements.
Our energy policy is available online at 
www.hsbc.com/our-approach/risk-and-
responsibility/sustainability-risk.
HSBC’s exposure to coal mining
In 2016, we updated our mining and 
metals policy, so that we no longer 
finance new thermal coal mines or new 
customers dependent on thermal coal 
mining. We also committed to publicly 
report on our exposure to the coal mining 
sector. At 31 December 2018, our 
exposure to coal mining was $0.8bn, 
unchanged from a year earlier. This 
represents 4% of our total exposure to 
the mining and metals sector in 2018. 
We have adopted a new methodology  
for the identification of exposures to  
the metals and mining sector in order  
to align with our TCFD disclosure. The 
methodology is explained in footnote 37 
on page 67 of the Annual Report and 
Accounts 2018.
Equator Principles in 2018
Under the terms of the Equator Principles, 
we report annually on the transactions 
completed under the Principles. In 2018, 
we undertook 18 transactions under  
the Principles, compared with 20 in 2017. 
A detailed summary of our transactions  
and implementation can be found at 
www.hsbc.com/our-approach/risk-and-
responsibility/sustainability-risk/equator-
principles.
29
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Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Sustainable finance

Task Force on Climate-related Financial Disclosures (‘TCFD’)
We all have a role to play in limiting 
climate change and supporting the 
transition to a low-carbon economy,  
and we are a signatory to the disclosure 
recommendations by the Financial 
Stability Board’s task force. This 
represents our second disclosure  
under the framework. 
Governance
Mitigating climate change is a key 
priority for our senior leadership, with 
sustainable finance metrics included in 
the Group’s strategic priorities. In 2018, 
there were two presentations on 
sustainability to the HSBC Holdings 
Board, two to the Group Audit 
Committee, four to the Group Risk 
Committee, and two to the HSBC Group 
Management Board. Senior leadership 
have engaged with regulators, industry 
associations and non-governmental 
organisations on this topic, such  
as through the Bank of England 
consultation on climate change, the 
Group Chairman’s participation in the 
One Planet Summit and the Group  
Chief Executive’s designation as a  
World Economic Forum climate  
leader. A summarised list of HSBC’s 
sustainability-related memberships is 
available at: www.hsbc.com/our-
approach/measuring-our-impact/
sustainability-memberships.
Strategy
Supporting the transition to a low-carbon 
economy is a key part of HSBC’s 
strategy, and new products have been 
offered to facilitate this, along with a 
pledge to provide $100bn of sustainable 
finance by 2025. To date, we have 
reached $28.5bn of that goal. For further 
information, see pages 26 and 28. We 
recognise many clients across sectors 
are making significant shifts towards the 
low-carbon economy. During 2019, we 
intend to develop new metrics to help 
measure these activities, with an aim to 
publish in next year’s disclosure. 
We believe education of our people  
is crucial on this topic. We gave 
sustainability training to more than 2,300 
employees during 2018 and launched a 
sustainability online learning programme 
for all employees globally, with content 
developed in collaboration with the 
University of Cambridge Institute for 
Sustainability Leadership. 
We report on the emissions of our own 
operations via CDP (formerly the Carbon 
Disclosure Project). This is available, as 
well as other information related to the 
sustainability of our own operations,  
at: www.hsbc.com/our-approach/
measuring-our-impact.
Risk management
We are increasingly incorporating 
climate-related risk, both physical and 
transition, into how we manage and 
oversee risks internally and with our 
customers. Climate risk is now included 
as a theme in our ‘Top and emerging 
risks report’ to ensure that it receives 
monthly management oversight via the 
Risk Management Meeting of the Group 
Management Board (‘RMM’) (see page 
30 of our Annual Report and Accounts 
2018). In addition, our Board-approved 
risk appetite statement contains a 
qualitative statement on our approach  
to sustainability, which will be further 
expanded in 2019 to include climate  
risk explicitly. 
We have a number of sustainability risk 
policies covering specific sectors. In 2018, 
we updated our energy policy to limit the 
financing of high-carbon-intensity energy 
projects, while still supporting energy 
customers on their transition to a low-
carbon economy. From the release of the 
new energy policy in April 2018 until the 
end of 2018, HSBC financed no new 
coal-fired power plants. 
Transition risk, in the context of climate 
change, is the possibility that a customer’s 
ability to meet its financial obligations will 
deteriorate due to the global movement 
from a high-carbon to a low-carbon 
economy. HSBC is working to embed 
transition risk into its day-to-day credit risk 
management. The aim is that over time, 
each wholesale counterparty will receive 
a client transition risk rating based on their 
susceptibility to, and ability to manage, 
transition risk. 
We have identified six higher transition 
risk sectors based on their contribution to 
global carbon dioxide emissions. These 
sectors are: oil and gas; building and 
construction; chemicals; automotive; 
power and utilities; and metals and 
mining. Over time we may identify 
additional sectors as having higher 
transition risk depending on a variety  
of factors, including country-level  
carbon dioxide reduction plans per  
the Paris Agreement.
The table below presents our exposure  
to the six higher transition risk sectors. 
These figures capture all lending activity, 
including environmentally responsible 
customers and sustainable financing. 
Further details on our approach to the 
quantification of exposures can be found 
in footnote 37 on page 67 of the Annual 
Report and Accounts 2018. This is 
expected to evolve over time as we 
develop new climate-related metrics.
Next steps
HSBC’s TCFD disclosures will continue 
to evolve and expand over time. In line 
with TCFD recommendations, our 
Annual Report and Accounts will start  
to disclose the additional climate 
risk-related metrics relating to our 
portfolio for specific sectors, as the 
availability of sufficient, reliable and 
relevant customer data permits.
Sector
% of total wholesale loans and advances to 
customers and banks in 201837
Oil and gas
≤ 3.9%
Building and construction
≤ 3.8%
Chemicals
≤ 3.9%
Automotive
≤ 3.4%
Power and utilities
≤ 3.0%
Metals and mining
≤ 2.8%
Total
≤ 20.8%
Total wholesale loans and advances to customers and banks amount to $668bn. 
 
For footnote 37, see page 67 of the Annual Report and Accounts 2018.
30
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Supporting sustainable growth | Sustainable finance

Our approach with our suppliers
We have globally consistent standards 
and procedures for the onboarding and 
use of external suppliers. We require 
suppliers to meet our compliance and 
financial stability requirements, as well  
as to keep to our sustainability code  
of conduct. Payment on time is of 
paramount importance, and as such our 
commitment to paying our suppliers is in 
line with the UK Prompt Payment Code.
Supplier ethical code  
of conduct
We have an ethical and environmental 
code of conduct for suppliers of goods 
and services, which must be complied 
with by all suppliers. While our businesses 
and functions are accountable for  
the suppliers they use, our global 
procurement function owns the code  
of conduct review process for them. 
Our goal is to work collaboratively  
with our supply chain partners on 
sustainability at all times. When a 
supplier or one of its sub-contractors  
is found to no longer be in compliance 
with this code, we will work with them 
on an improvement plan or, if deemed 
necessary, terminate the relationship. 
The ethical code of conduct, which we 
require suppliers to adopt, sets out the 
standards for economic, environmental 
and social impacts and outlines the 
requirements of having a governance 
and management structure to ensure 
compliance with this code. 
Suppliers  
Our supplier management conduct 
principles also set out how we conduct 
business with our third-party suppliers 
both in our legal and commercial 
obligations. They also explain how  
we treat suppliers fairly through our 
behaviour and actions, in line with  
the HSBC Values.
Supplier diversity initiative
We have a connected global supply 
base and inclusive sourcing strategies 
that reflect the communities where we 
operate, and help ensure we meet the 
needs of our diverse customer base. In 
June 2018, we also developed a supplier 
diversity and inclusion action plan, 
which encourages the use of minority-
owned and SME businesses.
31
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HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Total CO2 emissions (tonnes) 
1,000,000
900,000
800,000
700,000
600,000
500,000
CO2 per FTE (tonnes)
4.0
3.5
3.0
2.5
2.0
1.5
1.0
2011
2012
2013
2014
2015
2016
2017
2018
Carbon emissions (total and by FTE)
Key:
Total CO
2020 target was set at 2.5 CO2 tonnes/FTE until 2017, 
when the target was stretched to 2.0 CO2 tonnes/FTE
2 emissions (tonnes)
CO per FTE
 
 
2 
In 2012, we set ourselves 10 strategic 
targets to reduce the environmental  
and ethical impacts of our operations by 
2020. Most of these are either completed, 
resulting in us having stretched some of 
these targets, or are on track to complete. 
We are experiencing challenges on our 
recycling goal and some of our stretched 
targets, as detailed below. 
The targets include strategic goals to 
reduce our carbon emissions, energy, 
waste, water and paper. We also set 
targets to increase recycling, procure 
electricity from renewable sources and 
commission buildings to the highest 
sustainability standards. In addition,  
we are working to enable sustainability 
education for our people, engage with  
our supply chains and fund pilot projects. 
Achieving our operational goals
Sustainable operations  
We reached three of our targets ahead  
of schedule, and in 2017 made our  
waste and paper reduction targets more 
ambitious, and committed to procuring 
electricity from 100% renewable sources 
by 2030. 
To see progress against all our goals, visit 
www.hsbc.com/our-approach/building-a-
sustainable-future/sustainable-operations. 
The strategic goals are governed by  
the Group Chief Operating Officer 
Sustainability Committee, which meets 
quarterly. Each of the goals is ‘owned’ by 
an executive sponsor who is responsible 
for the target being achieved. In seeking 
to reach our goals, we collaborate closely 
with our strategic suppliers and our 
employees to encourage positive actions. 
Reducing carbon emissions
We continue to reduce our carbon emissions by cutting our 
energy consumption, being more efficient in our buildings, 
working with our strategic partners and focusing on our 
renewable procurement strategy. Since 2011, our carbon 
emissions have fallen by 30% per FTE. In 2018, our total CO2 
emissions were 559,000 tonnes.1
1. PwC performed a limited assurance engagement in accordance with 
International Standard on Assurance Engagements 3410 ‘Assurance 
engagements on greenhouse gas statements’, issued by the International 
Auditing and Assurance Standards Board. This can be found on our website 
www.hsbc.com/our-approach/measuring-our-impact. 
Our people want to make a difference in 
their communities and at work, and we 
will continue to partner with them to  
focus on our waste and recycling goals. 
We are proud to have surpassed our 
green buildings goal of constructing  
50 buildings to the highest sustainability 
standards. In 2018, we opened our  
new HSBC UK headquarters, which  
was built to a Leadership in Energy  
and Environmental Design (‘LEED’)  
Gold standard, making it the first  
building in Birmingham to be constructed 
to this standard. The LEED certification  
is a globally recognised symbol of 
sustainability achievement. In 2019, we 
are opening our new UAE headquarters 
with a LEED Gold standard and will intend 
to continue to incorporate sustainability 
standards in new buildings. 
32
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Supporting sustainable growth

Oﬃce waste (tonne)
70,000
0
10,000
20,000
30,000
40,000
50,000
60,000
%
50
100
90
80
70
60
40
30
20
10
0
2011
2012
2013
2014
2015
2016
2017
2018
Waste reduction and recycling (tonnes and percentage)
Key:
% reduction of oﬃce waste from 2011 baseline 
 
 
% of oﬃce waste recycled
2020 target was set at 50% until 2017, 
when the target was stretched to 75%
Oﬃce waste recycled 
Oﬃce waste not recycled 
%
0
10
20
30
40
50
Asia
Europe
North 
America
Latin 
America
Middle East1
Breakdown of electricity consumption by region 2018 (%)
Key:
  Renewable electricity sourced through PPA
  Other electricity 
  1. Middle East includes Turkey.
Our renewable electricity challenge
Since 2012, our renewable electricity strategy has evolved  
from purchasing renewable energy credits to influencing the 
markets in which we operate by sourcing electricity through 
power purchase agreements (‘PPAs’) that provide additional 
renewable energy to a country’s energy mix. In 2017, we 
committed to ensuring that 100% of our electricity was sourced 
from renewable sources by 2030, with an interim commitment  
of 90% by 2025. Between 2012 and the end of 2018, we 
contracted up to 29% of our electricity consumption through 
PPAs in various countries. As we strive to achieve our goal,  
we are conscious of the challenges this will present, such as  
in some markets in Asia where PPAs are currently unavailable. 
We are members of global initiatives, such as RE100, a  
global initiative uniting more than 100 influential businesses 
committed to 100% renewable electricity, that aim to create  
a united corporate voice to influence countries’ policy to open 
markets. However, in some smaller Asian markets, our electricity 
consumption is too small for projects to be economically viable, 
and therefore we will look to partner with other companies for  
a collaborative solution. By finding solutions to problems our 
customers and other companies face, we are in turn solving  
our own similar challenges, and vice versa. 
Our waste challenge
Our 2020 target was to reduce our total waste by 50% from our 
2011 baseline. This was achieved in 2015, and then stretched  
to reduce by 75% from this 2011 baseline. At 2018, we had 
reduced total waste by 63%.
Our recycling target is for 100% of our office and electronic 
waste to be recycled by 2020. Since 2011, we have recycled 
61% of our office waste. 
We are progressing well on our waste reduction target, however 
our recycling goal will be a challenge to achieve. As we continue 
to reduce our total waste, it becomes increasingly challenging to 
increase or maintain recycling levels. 
With differences within cities and buildings, we continue to 
address the waste challenge by finding ways to reduce waste, 
segregate and recycle. Most importantly, we continue to 
engage with our employees to better explain and further 
educate on local waste and recycling challenges.
29%
signed renewable electricity from power purchase  
agreements (2017: 27%)
Achieving our operational goals continued
33
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HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Sustainable operations

We have a responsibility to invest in  
the long-term prosperity of our global 
communities. In 2018, we contributed 
$105 million to charities and non-profit 
organisations running community 
projects around the world. These 
initiatives are run through partnerships 
that support responsible business, and 
help develop employability and financial 
capability skills. We also help our leaders 
across our network support important 
local causes. 
Helping to build future skills
In a world of rapidly changing technology 
and wealth inequality, new skills are 
needed to succeed. That is why we are 
focusing on increasing employability and 
financial capability for our customers, 
employees and communities.
In 2018, we delivered more than  
1,000 Your Financierge financial well-
being seminars in the US, UK, Mexico, 
Singapore and Australia, reaching  
over 26,000 people including over 2,100 
HSBC employees. We also ran three 
international campaigns, sharing money 
management challenges and tips. 
As part of our contribution to charities 
and non-profit organisations, we  
donated more than $8.9 million to 
partnerships focused on increasing 
financial capability, which are projected 
to benefit more than 850,000 people. Our 
people volunteered with many of these 
initiatives. In recognition of our work 
improving financial literacy, our Hong 
Kong business won a Financial Education 
Our approach to partnerships
Committed to  
communities 
Champion award from the Investor 
Education Centre. We donated more 
than $27 million to charities and  
non-profit organisations to support 
partnerships focused on increasing 
employability, which are projected to 
benefit more than 400,000 people. 
To support the important conversation 
on the future of work in a more 
automated society, three of our senior 
leaders joined steering committees for 
the World Economic Forum’s System 
Initiative on Shaping the Future of 
Education, Gender and Work. 
For more information on our how we support our 
employees to develop their skills, see page 25.
For more information on how we are increasing 
customer financial capability, see pages 11 and 44.
Supporting supply chain 
sustainability
We provide support for sustainable supply 
chains through charitable programmes in 
certain sectors. Here we report on our 
progress against these initiatives.
Textiles and apparel
In 2015, greenhouse gas emissions  
from textiles production totalled 1.2 
billion tonnes of CO2 equivalent, which 
was more than those of all international 
flights and maritime shipping combined.1 
We have established partnerships  
with the Apparel Impact Institute,  
WWF and WaterAid to improve the 
environmental and social sustainability  
of the apparel supply chain. These are 
focusing on mill, leather tannery and 
factory improvements in China, India, 
Bangladesh and Vietnam. With our 
support, we expect to help 850 facilities 
to improve their environmental and  
social impact by the end of 2020. In  
2018, through our support for WWF 
in China, 113 supplier companies  
were engaged directly to improve 
sustainability standards. 
Palm oil
To help address the sustainability 
impacts of palm oil production, we 
launched a new programme with  
WWF in 2018 to deal with the challenges 
related to the supply and demand for 
certified sustainable palm oil in Asia. This 
programme will support research and 
collaboration to remove barriers to flows 
of certified sustainable palm oil. It will 
aim to demonstrate what is possible in 
the shift to sustainability in the sector,  
in line with our no deforestation, peat  
or exploitation commitment. For more 
information on our engagement on  
palm oil, see page 29.
1. Ellen MacArthur Foundation, A new textiles 
economy: Redesigning fashion’s future.  
(2017, www.ellenmacarthurfoundation.org/
publications).
Case study: Building financial capability with 
the Mann Deshi Foundation
Mann Deshi was set up by Chetna Gala Sinha as the first 
rural bank in India to provide a space for women to save, and 
get affordable and easy access to credit. Since 1996, more 
than 90,000 women have set up accounts with over $13 
million in deposits. The Mann Deshi Foundation was also set 
up to supplement the bank by providing access to financial 
education, skills and a support network for rural women. 
We have been working with the Mann Deshi Foundation 
since 2006, supporting it to deliver training to rural women 
on making and managing money. The focus has been on 
delivering meaningful outcomes. Through HSBC-supported 
programmes, more than 40% of participants had improved 
levels of financial capability, over 20% of participants had 
set up their own new businesses, and over 60% 
experienced an improved standard of living.
>1.2 million
people projected to benefit from financial 
capability and employability programmes 
funded in 2018
34
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Supporting sustainable growth

Our approach to partnerships continued
Our corporate volunteering
We operate across 66 countries so  
when our employees volunteer their time 
and expertise, we can have a truly global 
impact. We are committed to helping our 
people contribute to their communities, 
and we encourage volunteering through 
paid volunteering days. In 2018, our 
employees gave 264,000 hours to 
community activities during work time. 
This represented a decrease from 2017 
(272,000 hours), although the average 
amount of time contributed per FTE 
remained broadly consistent. 
As well as benefiting the communities 
we serve, volunteering can bring great 
personal rewards, enabling people to 
build connections, develop new skills, 
and gain a fresh perspective.
We organise volunteer opportunities  
that help enable our people to address 
challenges within the community, 
including developing employability  
and financial capability skills needed to 
succeed in the future. We also support our 
people organising their own volunteering 
initiatives and involving colleagues. 
Personal employee-led volunteering  
is actively encouraged and currently 
accounts for a third of the volunteering  
in which our people participate.
Supporting disaster relief efforts
As part of our community programme, 
we provide money to support disaster 
relief based on need. We ensure we 
listen to our local colleagues and  
support the best-placed charities on a 
case-by-case basis. We provide support 
and disaster relief to many areas during 
catastrophic events such as fires,  
floods, tsunamis and hurricanes. 
We expect to help 
850
facilities to improve their environmental  
and social impact by the end of 2020
Case study: HSBC Living 
Business programme
The HSBC Living Business programme 
supports the development of 
sustainable supply chains. It provides 
a learning platform for small and 
medium-sized enterprises (‘SMEs’)  
to understand industry best practice, 
and it recognises organisations 
adopting new approaches. Through 
partnerships with customers, NGOs 
and other stakeholders, we are 
helping businesses to transition  
to more sustainable supply chain 
models. Since 2018, ESG and UN 
Sustainable Development Goals have 
been introduced to the programme 
for enhancing the international 
growth and connectivity of SMEs.
264,000 hours
our employees volunteered to community 
activities during working hours in 2018
The United Nations (‘UN’) Sustainable 
Development Goals (‘SDGs’) are 17 goals  
and 169 targets to be achieved by 2030.  
These SDGs are a call to action to protect  
the planet, end poverty, and ensure peace  
and prosperity. Achieving the goals requires 
partnerships between governments, the  
private sector and civil society. 
We have a responsibility to contribute to this 
globally agreed framework for action. By aligning 
our values, conduct and business activity, the 
SDGs set the context for our long-term ambition. 
Material areas are disclosed as part of this ESG 
Update in line with the reporting guidance in 
the practical guide published by UN Global 
Compact and Global Reporting Initiative1.
In the adjacent graphic, we have highlighted  
the six SDG targets we prioritise for their close 
alignment to our strategy. We will contribute  
to these through our financing and investments, 
as well as how we conduct business and operate.
Demonstrating our support of the goals we 
have issued two SDG bonds, with the proceeds 
being used to support projects that offer broad 
social, economic and environmental benefits as 
aligned to seven selected SDG goals. Further 
details, including the framework and the  
bonds’ first impact reports may be found  
on www.hsbc.com/investors/fixed-income-
investors/green-and-sustainability-bonds. 
1. We are a corporate member of a UN Global Compact 
and Global Reporting Initiative-led corporate Action 
Platform Reporting on the SDGs. The guide is available 
at www.globalreporting.org/resourcelibrary/GRI_UNGC_
Reporting-on-SDGs_Practical_Guide.pdf. 
Our approach to the UN Sustainable Development Goals
35
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HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Committed to communities

Our relationship
We act on our responsibility to run our 
business in a way that upholds high 
standards of corporate governance. 
We are committed to working with 
our regulators to manage the safety  
of the financial system, adhering to 
the spirit and the letter of the rules 
and regulations governing our 
industry. In our endeavour to restore 
trust in our industry, we aim to act 
with courageous integrity and learn 
from past events to prevent their 
recurrences. 
We meet our responsibility to society 
through paying taxes and being 
transparent in our approach to this. 
We also seek to ensure we respect 
global standards on human rights in 
our workplace and our supply chains, 
and continually work to improve our 
compliance management capabilities. 
We acknowledge that increasing 
financial inclusion is a continuing 
effort, and we are carrying out a 
number of initiatives to increase 
access to financial services.
At a glance
 A responsible 
business culture
We remain committed to high standards of governance.  
We work alongside our regulators and recognise our 
contribution to building healthy and sustainable societies. 
Corporate governance
Safeguarding the financial system
Protecting human rights
A responsible approach to tax
At HSBC we recognise the duty  
of states to protect human rights 
and the role played by business in 
respecting them, in line with the  
UN Guiding Principles’ Protect, 
Respect and Remedy framework
$7.0bn
taxes paid in 2018
(2017: $6.8bn)
>658 
million
transactions across 207 
million accounts that we 
screen each month for 
signs of money laundering 
and financial crimes
$7.6bn
taxes collected on 
behalf of governments
(2017: $8.1bn)
35%
women on the Board
(2017: 29%)
10
executive and non-
executive committee 
meetings where 
sustainability was 
discussed
(2017: 5)
36
HSBC Holdings plc Environmental, Social and Governance Report, April 2019

Restoration of trust in our industry remains 
a significant challenge as past misdeeds 
continue to remain in the spotlight. But it  
is a challenge we must meet successfully. 
We owe this not just to our customers and 
to society at large, but to our employees to 
ensure they can be rightly proud of the 
organisation where they work. We aim to 
act with courageous integrity in all we do. 
This guiding principle means having the 
courage to make decisions based on doing 
the right thing for customers and never 
compromising our ethical standards  
or integrity.
We have also sought to learn from past 
mistakes, such as the following three 
examples, and we are seeking to develop 
and implement specific measures 
designed to prevent recurrence of similar 
events in the future.
Anti-money laundering  
and sanctions
Between the 1990s and 2010, as 
acknowledged by HSBC in various 
agreements with US and UK authorities  
in 2012, HSBC failed to implement 
appropriate anti-money laundering (‘AML’) 
and sanctions controls. These oversight 
and control failures resulted in HSBC 
allowing at least $881 million in drug 
proceeds to be laundered through  
HSBC into the US financial system and 
approximately $660 million in transactions 
involving sanctioned countries, such  
as Iran, Cuba, Sudan, Libya and Burma,  
to be processed, in violation of applicable 
US laws.
In December 2012, HSBC entered into 
resolutions with, among others, the US 
Department of Justice (‘DoJ’) and the UK 
Financial Services Authority (now the 
Financial Conduct Authority, or FCA), 
regarding these past AML and sanctions-
related failings. Under these agreements, 
which included a five-year deferred 
prosecution agreement with the DoJ  
(‘the AML DPA’), HSBC made payments 
totalling $1.9bn to US authorities and 
undertook various further obligations, 
including the retention of an independent 
compliance monitor. 
Restoring trust  
Over the past several years, we  
have radically restructured our global 
operations and significantly strengthened 
our ability to combat financial crime. 
We recognise that we have a responsibility 
to help protect the integrity of the global 
financial system. In order to fulfil that 
responsibility, we have made, and continue 
to make, significant investments in our 
ability to detect, deter and prevent financial 
crime. We have exited customers, 
products and countries where we deemed 
the financial crime risk too high to manage. 
We are also working with governments 
and other banks to advance our mutual 
interests in this area. These steps are 
enabling us to much more effectively 
reduce the risk of financial crime.
In 2012, we launched our Global 
Standards initiative, focused on putting  
in place the most effective standards to 
combat financial crime across our 
operations globally. As part of this  
effort, we designed and implemented 
new, globally consistent policies on  
AML and sanctions that often extend 
beyond the requirements of local laws 
and regulations. Since 2013, we also 
established a Financial System 
Vulnerabilities Committee (‘FSVC’)  
to oversee our financial crime risk 
management reforms. The FSVC reports  
to the Board on matters relating to 
financial crime and financial system 
abuse, and provides a forward-looking 
perspective on financial crime risk, 
anti-bribery and corruption.
Among other steps, we hired experienced 
senior personnel to lead the effort and 
significantly increased our financial crime 
compliance capabilities; we put in place  
a robust investigations capability; we 
improved and expanded our financial 
crime compliance training initiatives;  
and we upgraded or replaced key 
compliance IT systems, with over  
$1bn spent since 2015.
Beyond these improvements, as part of 
our commitment to protect the integrity  
of the financial system, and to do our part 
to fight financial crime, we continue to 
enhance our systems and are working to 
integrate our reforms into our day-to-day 
risk management practices so that our 
programme is effective and sustainable 
over the long term. We are also renewing 
our focus on anti-bribery and corruption 
as part of a dedicated three-year 
programme to advance the Group’s 
anti-bribery and corruption risk 
management capability. As part of our 
commitment to the UN Global Compact, 
we have pledged to work against 
corruption in all its forms, including 
extortion and bribery.
The AML DPA expired in December 2017, 
and we are pleased that our progress in 
strengthening our AML and sanctions 
compliance capabilities has been 
recognised. Our work in this area will 
continue to be consistent with our 
strategic priority of safeguarding our 
customers and delivering industry-leading 
financial crime standards.
Over the coming years, we aim to evolve 
significantly our approach to financial 
crime risk management by building 
advanced analytical capabilities, 
including artificial intelligence, designed 
to help us target illicit conduct with 
greater sophistication and precision.  
This will help us make a step change  
in our effectiveness at fighting financial 
crime and set a new standard that aims 
to lead the industry. We expect to be 
faster and more accurate at detecting 
potential financial crime and ever more 
targeted in our risk assessments. We 
expect to generate actionable insight that 
we can use ourselves and provide to law 
enforcement to help keep criminals out 
of the financial system. This will benefit 
the Group, our customers and society  
at large.
For further information about our compliance 
initiatives, see page 41.
37
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HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Customer tax evasion 
Prior to 2011, our Swiss private bank 
provided its customers with standard 
services, common in the Swiss banking 
industry at the time, which enabled 
customers to conceal their assets from 
tax authorities and avoid paying their 
taxes. These services included, among 
other things, the opening of encoded 
numbered accounts that kept the 
account holder’s name confidential  
and the provision of ‘hold mail’ services 
whereby all mail was kept at the bank  
for customers to avoid receiving letters  
at their domestic addresses. Our Swiss 
private bank, through certain of its 
relationship managers, offered these 
services while it had access to 
information enabling it to know, or  
to suspect, that certain customers would 
use those services in order to conceal 
their assets from tax authorities.
While HSBC has reached agreements 
with certain law enforcement authorities 
to resolve investigations relating to 
allegations of tax evasion or tax fraud, 
money laundering and unlawful cross-
border banking solicitation arising  
out of these past practices, the Group 
continues to cooperate in ongoing 
investigations by other tax 
administration, regulatory and law 
enforcement authorities around the 
world in connection with similar 
allegations. We acknowledge that the 
compliance culture and standards of due 
diligence in our Swiss private bank were 
significantly lower in 2006 and 2007 than 
they are today. With hindsight, it is clear 
that we maintained too many small and 
high-risk customer accounts and our 
private banking business was stretched 
over too many geographical markets,  
all of which contributed to failings in 
standards, culture and controls. 
In recent years, our Global Private 
Banking (‘GPB’) business has taken 
significant steps to address these 
historical control weaknesses, most 
notably in Switzerland. Beginning in 
2012, GPB developed a tax transparency 
policy that included enhanced know your 
customer (‘KYC’) and AML procedures 
and a review of existing accounts against 
potential indicators of non-compliance 
with tax obligations. Accounts were 
closed where issues were identified  
Major criminal and regulatory fines and penalties and PPI remediation1 
Pre- 
2005
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
AML-related 
investigations
1,921
GPB tax-related 
investigations
13
43
13
360
RMBS-related 
investigations
765
Libor/Euribor
36
FX-related 
investigations
618
6
175
102
PPI
333
870
1,138
700
553
448
502
741
Key
 Duration of conduct period	   $m  Fines/penalties/other costs
 
1. This chart only includes fines and penalties arising out of major investigations involving criminal, regulatory, competition or other law enforcement 
authorities, and costs relating to PPI remediation. The chart reflects the year in which a fine or penalty was imposed or when the remediation  
cost was paid, which may be different from when a loss or provision was recognised under IFRSs. Settlements or other costs arising out of private  
litigation or arbitration proceedings are not included.
38
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
A responsible business culture | Restoring trust

and could not be resolved. GPB has  
also amended its standard terms and 
conditions, which now require customers 
to affirm that they are in compliance with 
their tax obligations, allow the bank to 
refuse requests for cash withdrawals and 
place strict controls on withdrawals over 
$10,000. Furthermore, GPB discontinued 
its ‘hold mail’ service and has withdrawn 
from markets where it has been unable 
to conduct due diligence to a satisfactory 
standard on its customers.
As a result of these reforms, the number 
of accounts and total customer assets  
of GPB have been significantly reduced 
by this intensive de-risking exercise, 
where we have put compliance and  
tax transparency ahead of profitability. 
Where we used to offer banking services 
to customers in more than 140 countries, 
GPB now focuses on 34 strategic 
markets, with customer assets actively 
managed down by $140bn between 
2013 and 2018.
While GPB has resolved a number  
of legacy issues relating to the  
past, investigations into former  
practices are ongoing in a number  
of countries at the time of publication.  
In addition, we acknowledge that  
GPB’s role in providing financial  
services to high-profile individuals may 
sometimes result in GPB receiving  
undue media attention.
For further information about our Global Private 
Banking customers, see pages 16 and 17.
Foreign exchange conduct
Prior to 2013, our foreign exchange (‘FX’) 
business lacked adequate governance, 
oversight and risk management in order 
to ensure compliance with safe and 
sound banking practices and applicable 
internal policies. As a result, we failed to 
detect and address unsafe and unsound 
conduct by certain of our FX traders, 
which included the misuse of confidential 
inside information to conduct FX trades, 
possible agreements with traders of 
other institutions to coordinate FX trading 
and disclosure of confidential information 
to traders of other institutions. 
In November 2014, HSBC agreed to 
regulatory settlements with the FCA  
and the US Commodity Futures Trading 
Commission in connection with their 
respective investigations of HSBC’s 
trading and other conduct involving FX 
benchmark rates. In September 2017, 
HSBC entered into a consent order with 
the US Federal Reserve Board (‘FRB’)  
in connection with its investigation into 
HSBC’s FX activities. Under the terms  
of that order, HSBC agreed to undertake 
certain remedial steps and to pay a civil 
money penalty to the FRB. In January 
2018, HSBC Holdings plc entered into  
a three-year deferred prosecution 
agreement with the DoJ (‘FX DPA’), 
regarding fraudulent conduct in 
connection with two particular 
transactions in 2010 and 2011. 
Since the historical conduct described  
in these agreements, we have introduced 
a number of measures designed to make 
the control environment more robust  
and prevent these failings from recurring 
in the future. We have dedicated,  
and continue to dedicate, significant 
resources to strengthen our systems  
and controls. While the investigations 
focused specifically on our FX activity, 
they have also given us good reason  
to look again at other aspects of our 
conduct more broadly within the Global 
Banking and Markets (‘GB&M’) business. 
Improvements to our conduct agenda 
started more than four years ago and 
continue to this day. We are enhancing 
and accelerating progress made in 
strengthening and remediating our 
systems and controls and broader 
compliance culture through a newly 
established GB&M Conduct Committee, 
led by our GB&M Chief Executive Officer. 
Market experts are providing input.  
The agenda focuses on culture and 
behaviours; customers, including 
suitability, conflicts of interest, pricing 
and transparency; markets, covering 
market conduct, trade execution and 
competition; governance and controls; 
and strategy and business planning. 
Progress is being tracked and reported 
through our own governance channels, 
as well as being reported to the FRB,  
DoJ and our regulators in line with our 
agreements with them all.
Conduct is core to how we operate  
and manage our business. We have 
already implemented improvements  
to algorithmic trading to manage risk 
around benchmark orders, and updated 
our policies for sales, order handling, 
managing confidential customer 
information and conflicts of interest, 
pre-hedging and market abuse. In 2018, 
we introduced further improvements to 
the management of sensitive information 
through physical barriers, technology 
controls and procedures. We have also 
continued to invest in enhancing our 
voice, trade and electronic surveillance 
capabilities across the globe to improve 
the monitoring of telephone calls, instant 
messages and trades to spot potentially 
improper activity. Global and regional 
conduct governance forums have been 
created to provide supervision and 
oversight over the implementation and 
effectiveness of our conduct agenda. An 
extensive plan is in place, and we aim to 
deliver this as fast and efficiently as we 
can. Our success will determine how well 
we deliver the right outcomes for our 
customers and stakeholders, consistently 
and reliably, for many years to come.
For further information about our  
Global Banking and Markets customers,  
see pages 14 and 15.
34
strategic markets that our GPB business 
focuses on, down from more than 140 as  
a result of de-risking
39
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Restoring trust

Ensuring strong  
corporate governance  
We are committed to high standards of 
corporate governance across the Group. 
A comprehensive statement on our 
corporate governance practices is set 
out on pages 152 to 213 of our Annual 
Report and Accounts 2018.
The role of the Board
The Board of HSBC Holdings plc aims to 
promote the Group’s long-term success, 
deliver sustainable value to shareholders 
and promote a culture of openness and 
debate. Led by the Group Chairman, the 
Board sets the Group’s strategy and risk 
appetite. It also approves capital and 
operating plans for achieving strategic 
objectives on the recommendation  
of management. 
The majority of the Board comprises 
independent non-executive Directors. 
Their role is to challenge and scrutinise 
the performance of management and  
to help develop proposals on strategy. 
They also review the performance of 
management in meeting agreed goals 
and objectives and monitor the Group’s 
risk profile. During 2018, the Board 
reduced the number of Board committees 
from seven to five. These changes created 
clearer and stronger lines of authority and 
accountability, which enable the Board to 
devote more time to priority areas.
Board diversity 
In 2018, the Board’s diversity and inclusion 
policy was updated to help ensure HSBC 
and its various stakeholders continue  
to benefit from a Board that includes 
Directors from a range of different 
backgrounds and whose ethnicity, 
experience, age, geographical provenance 
and gender more closely reflect the 
diversity of our customers and the 
communities that we serve. The Board 
diversity and inclusion policy is available at 
www.hsbc.com/our-approach/corporate-
governance/board-responsibilities. 
 For further details on our diversity and 
inclusion efforts, see page 24.
Shareholder engagement 
We welcome enquiries from individuals 
on matters relating to their shareholdings 
and HSBC’s business. Communication 
with shareholders is given a high priority 
by the Board, and there is regular 
dialogue with institutional investors. 
Directors are also encouraged to develop 
an understanding of the views of major 
shareholders. As Senior Independent 
Director, Jonathan Symonds is available 
to shareholders if they have concerns 
that cannot be resolved or for which 
normal channels would be inappropriate. 
He may be contacted via the Group 
Company Secretary at 8 Canada Square, 
London E14 5HQ.
Extensive information about HSBC and 
its activities is provided to shareholders 
in the Annual Report and Accounts 2018, 
the Strategic Report and the Interim 
Report as well as at www.hsbc.com.
Corporate governance regulatory 
changes 
In July 2018, the Financial Reporting 
Council published the new UK Corporate 
Governance Code (‘Code’) together  
with the revised Guidance on Board 
Effectiveness. The new Code places 
greater emphasis on how the Board 
considers the interests of all stakeholders 
in its discussions and decision making, 
and promotes a strong internal culture. 
We see the new Code as an opportunity 
to further enhance our existing 
stakeholder engagement, ensuring that 
the business as a whole can continue  
to develop constructive and considerate 
relationships. We aim to include details  
of this in the Annual Report and 
Accounts 2019. 
 
Sustainability governance 
While the Board has oversight of the 
Group’s sustainability and ESG initiatives, 
the Group Management Board is 
accountable for their delivery, reflected in 
sustainability targets within the long-term 
incentive scorecards for executive 
Directors, and selected scorecards of 
Group Managing Directors. The 2017 
long-term incentive scorecards of 
executive Directors incentivise achieving  
a cumulative financing and investment 
target of $30bn to $34bn for developing 
clean energy and lower-carbon 
technologies and projects that contribute 
to the delivery of the Paris Agreement and 
the UN Sustainable Development Goals 
over the three-year period to 31 December 
2020. The 2018 long-term incentive 
scorecards of executive Directors include 
an ESG rank measure incentivising 
achievement of ‘Outperformer’ 
Sustainalytics rating.
As discussed in our TCFD disclosure on 
page 30, the Board receives a half-yearly 
sustainability update, covering topics such 
as progress against the three sustainability 
pillars and non-governmental organisation 
(‘NGO’) engagement. This helps ensure 
our sustainability agenda remains 
prominent at the most senior levels. 
Our Climate Business Council coordinates 
sustainable finance activities across the 
Group, supported by various working 
groups within global businesses, 
functions and regions. An ESG Steering 
Committee, chaired by the Group Chief of 
Staff, leads our approach on ESG topics, 
including considerations related to 
external disclosure and materiality. 
A climate risk working group was 
established in 2018, which seeks to 
implement the objectives of the Climate 
Business Council through the development 
of policy and limit frameworks designed to 
protect the Group from climate-related 
risks (including transition risk and physical 
risks) that are outside risk appetite. The 
Group Risk Committee is responsible for 
overseeing enterprise risks that have an 
impact on the Group, including climate risk.
See page 30 for our TCFD disclosure.
40
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
A responsible business culture

Safeguarding the  
financial system  
We continued to consolidate our 
progress in tackling financial crime  
while launching initiatives in a number  
of new areas.
Our Global Standards programme, 
launched in 2013 to upgrade our financial 
crime controls, is now approaching its 
conclusion. During 2018, we concentrated 
on completing some of the final elements 
of the programme designed to ensure 
management of financial crime risk is well 
embedded in our day-to-day activities, 
with robust governance and reporting to 
enable performance to be assessed. 
In June, we set out new strategic priorities 
including the aim of delivering industry-
leading financial crime standards. 
Developing an intelligence-led approach  
to financial crime risk management using 
new technologies and advanced analytical 
techniques is key to achieving this 
ambitious target. We made good progress 
on this agenda and will continue to develop 
our approach in 2019 and beyond.
We launched an anti-bribery and 
corruption transformation programme, to 
enhance the policies and controls around 
identifying and managing these risks 
across the Group. We also launched a 
transformation programme to strengthen 
our ability to fight fraud and protect  
our customers. 
For more information on our Global Standards 
and anti-bribery and corruption programmes, 
see pages 37 to 39.
Technology 
Technologies such as artificial intelligence (‘AI’) and advanced analytics will 
enable us to tackle financial crime more effectively. Our approach combines 
developing our own technology solutions with bringing in the best external 
technology. 
Our investment in a start-up company called Quantexa enabled our investigators 
in 2018 to deploy a new software system to spot financial crime networks in near 
real time by looking at internal and external data to find possible links between 
individuals or companies. Working with another fintech company, Caspian,  
we have developed a system that assembles all the relevant information on a 
particular suspicious transaction. It then uses AI to recommend whether it should 
be investigated further, enabling our people to focus on the highest priority cases. 
Our flagship intelligence-led initiative is a new approach that combines a  
range of data sources to dynamically assess the potential financial crime risk 
that an individual customer presents. We believe it will enable us to be faster 
and more accurate at detecting suspicious activity and more granular in our  
risk assessments. During 2018, we developed a prototype that, while at an  
early stage, has proved to be markedly better at finding potential financial  
crime than existing industry-standard methods. We will begin to implement  
it in 2019, alongside existing systems. We continue to engage with regulators 
on our approach.
Partnerships
The insights delivered by new technology will have the greatest impact when 
we work with partners. Public-private partnerships enable banks to share 
information with each other, regulators and law enforcement. We are a 
member of all six public-private financial crime partnerships that have been 
established around the world. Through our membership we can provide 
better insight about suspicious transactions to law enforcement and receive 
intelligence that helps us to better target our work in detecting financial crime.
We continue to advocate for partnerships in other jurisdictions and for  
the effective operation of existing partnerships, including sponsoring public 
research into the future of financial intelligence sharing due to be released  
in 2019.
Society 
During 2018, we successfully trialled an approach to providing victims of 
human trafficking in the UK with monitored retail banking facilities, working 
closely with charities that provide support to victims. The aim is to help the 
victims reintegrate with society and break the cycle of abuse. The accounts 
were trialled through a small number of branches and we will now make them 
available in other areas of the UK. 
Financial crime can have a devastating impact on the societies that we serve, 
and we have taken active steps to reduce that impact. In October, we joined 
the task force established by United for Wildlife to coordinate financial firms 
tackling the illegal wildlife trade by helping prevent the flow of illicit profits. 
Members of the task force signed up to a declaration that commits them to 
steps such as providing intelligence about the trade to regulatory bodies and 
law enforcement agencies. 
The scale of our work 
Each month, we screen over 658 
million transactions across 207 
million accounts for signs of money 
laundering and financial crime. In 
addition, we screen approximately 
130 million customers and 37.3 
million transactions monthly for 
sanctions exposures. During 2018, 
we filed over 85,000 suspicious 
activity reports to law enforcement 
and regulatory authorities where we 
identified potential financial crime.
41
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Taxes paid – by type of tax
Tax on proﬁts
$3,141m
Employer taxes
$1,068m
(2017: $2,896m)
(2017: $1,178m)
Withholding taxes
$276m
Bank levy
$1,135m
(2017: $236m)
(2017: $1,021m)
Irrecoverable VAT
$1,074m
(2017: $1,102m)
Other duties and levies
$360m
(2017: $364m)
Taxes paid – by region
Hong Kong
$1,398m
Rest of Asia-Paciﬁc
$960m
(2017: $1,043m)
(2017: $938m)
India
$384m
UK
$2,693m
(2017: $297m)
(2017: $2,654m)
Switzerland
$13m
(2017: $(67)m)
Rest of Europe
$693m
(2017: $753m)
US
$162m
(2017: $134m)
Rest of North America
$237m
(2017: $182m)
Middle East and North Africa
$233m
(2017: $419m)
Latin America
$281m
(2017: $443m)
Taxes collected – by region
Hong Kong
$162m
Rest of Asia-Paciﬁc
$2,741m
(2017: $297m)
(2017: $2,415m)
India
$122m
UK
$1,398m
(2017: $126m)
(2017: $1,394m)
Switzerland
$41m
(2017: $47m)
Rest of Europe
$820m
(2017: $752m)
US
$835m
(2017: $823m)
Rest of North America
$261m
(2017: $263m)
Middle East and North Africa
$118m
(2017: $219m)
Latin America
$1,148m
(2017: $1,768m)
Keeping a responsible  
approach to tax  
We seek to pay our fair share of tax in the 
jurisdictions in which we operate and to 
minimise the likelihood of customers using 
our products to avoid or evade tax. Our 
approach to tax and governance processes 
is designed to achieve these goals. 
We have established a formal tax risk 
management framework, which is 
designed to ensure that tax-motivated 
transactions or products are not adopted by 
the Group. Significant investment has been 
made to strengthen our tax risk processes 
and train staff to identify instances of 
potential tax evasion. There remain areas 
where further improvements are required 
and we are working to address these.
With respect to our own taxes, we  
are guided by the following principles:
––We are committed to applying both  
the letter and spirit of the law in all 
jurisdictions in which we operate.  
This includes adherence to a variety  
of measures arising from the OECD  
Base Erosion and Profit Shifting  
(‘BEPS’) initiative. 
––We seek to have open and transparent 
relationships with all tax authorities.  
As with any group of our size and 
complexity, a number of areas of 
differing interpretation or disputes with 
tax authorities exist at any point in time.  
We work with the local tax authorities  
to try to agree and resolve these in a 
timely manner.
––We have reduced the number of legal 
entities located in very low or nil tax 
jurisdictions from 121 at the beginning  
of 2015 to 46 by the end of 2018. This 
process will continue throughout 2019 
and 2020, with the aim of ensuring that 
the HSBC entities remaining in such 
jurisdictions are regulated entities 
essential for conducting business.
With respect to our customers’ taxes, we 
are guided by the following principles:
––We have made considerable investment 
implementing processes designed to 
increase transparency and reduce the  
risk of banking services being used to 
facilitate customer tax evasion and 
financial crime. These processes 
incorporate requirements arising from 
external tax transparency initiatives 
including the US Foreign Account Tax 
Compliance Act, the OECD Standard  
for Automatic Exchange of Financial 
Account Information (the ‘Common 
Reporting Standard’), and the UK 
legislation on the corporate criminal 
offence of failing to prevent the  
facilitation of tax evasion.
––We have processes in place to help 
ensure that tax-motivated products are 
not provided to our customers.
For further details on our approach to  
financial crime and what steps we have  
taken, see pages 37 to 39. 
Our tax contributions
As highlighted below, in addition to paying 
$7.0bn of our own tax liabilities during 
2018, we collected taxes of $7.6bn on 
behalf of governments around the world.  
A more detailed geographical breakdown 
of the taxes paid in 2018 is provided on 
page 65 of the HSBC Holdings plc  
Annual Report and Accounts 2018.
42
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
A responsible business culture

Respecting  
human rights 
Business does not exist in isolation: it  
is part of communities and serves the 
people. We recognise the duty of states 
to protect human rights and the role 
played by business in respecting them,  
in line with the UN Guiding Principles’ 
(‘UNGPs’) Protect, Respect and Remedy 
framework. We have signed, or 
expressed support for, a number of 
international codes, as set out in our 
2015 Statement on Human Rights.
In 2018, we set up a Human Rights 
Steering Committee, which is overseeing 
the development of our approach to 
human rights. This approach will 
incorporate new recommendations from 
initiatives such as the OECD’s general  
Due Diligence Guidance for Responsible 
Business Conduct, published in May 2018. 
We primarily reflect human rights 
considerations as they apply to our 
people, our suppliers and our customers. 
Some examples are provided below.
Employees
We are committed to an inclusive  
culture where our people can be 
confident that their views matter, their 
workplace is an environment free from 
bias, discrimination and harassment,  
and where they can see that 
advancement is based on merit. This 
commitment reflects the provisions of 
both the Universal Declaration of Human 
Rights (‘the UDHR’) and the International 
Labour Organization Declaration on 
Fundamental Principles and Rights at 
Work (‘the ILO Declaration’), including 
freedom of association. For further 
details on the diversity of our workforce, 
see page 24.
Suppliers
We expect our suppliers to uphold 
human rights in carrying out their 
business, reflecting the UDHR and ILO 
Declaration principles. Our ethical and 
environmental code of conduct for 
suppliers requires them to respect the 
human rights of their employees and the 
communities in which they operate, and 
comply with all relevant legislation, 
regulations and directives. During 2018, 
we undertook a risk-mapping exercise  
to identify the most salient human rights 
risks in our supply chain, particularly 
those relating to modern slavery and 
human trafficking. 
Customers
The principal aim of the UNGPs is to 
prevent human rights abuses. We seek  
to ensure that the financial services we 
provide to our customers do not result  
in an unacceptable impact on people  
or the environment. We are a signatory 
to the Equator Principles, which are 
underpinned by the International Finance 
Corporation’s Performance Standards, 
and which focus on issues including land 
rights, child labour, forced labour, and  
the rights of indigenous and local 
communities. We work with our 
customers to help them improve their 
sustainability practices. Additionally, our 
financial crime teams actively seek to 
identify the proceeds of potential human 
rights abuses to inform law enforcement 
and take ‘bad actors’ out of the financial 
system. A case study on this is contained 
in our Modern Slavery Act statement. 
 
 
Modern Slavery Act
Our statement under the UK’s  
2015 Modern Slavery and Human 
Trafficking Act gives details of our  
work in combating these particularly 
egregious human rights abuses. We are 
raising awareness with our customers  
in selected sectors and regions as part  
of our annual credit review processes. 
We are educating our own colleagues 
directly through training and indirectly 
through communications. 
Stakeholder engagement
We remain committed to developing our 
approach to managing human rights risks 
as they affect rights holders. We attended 
the UN Business and Human Rights 
Forum in November 2018 and continued 
our involvement with the Thun Group, an 
informal group of bank representatives 
that provides guidance on how the 
UNGPs should be applied across banking 
activities. We support the UN Global 
Compact’s promotion of sustainable  
and socially responsible policies, and 
participate in the UK Chapter’s Modern 
Slavery Act working group. 
In 2018, we had contact with five civil 
society groups where human rights 
abuses were raised. These abuses were 
alleged to have been committed by 
HSBC customers. We investigate 
credible allegations of human rights 
violations as they are reported to us  
via engagement with stakeholders. If 
required, particularly serious issues 
ultimately pass to the Group 
Management Board. 
 
43
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

We believe that the global economy  
is better served by customers being  
part of the regulated financial system.  
In support of this, we carried out  
a number of initiatives in 2018 to  
increase access to financial services.  
Our approach to financial inclusion  
is focused on engaging with partners  
to raise industry standards; improving 
accessibility of products and services; 
and investing in educational content. 
We acknowledge that increasing 
financial inclusion is a continuing  
effort, and there are a number of 
initiatives we will be focusing on  
in 2019. These include: 
––implementing the UK Finance Financial 
Abuse Code of Practice, which aims to 
increase awareness for victims, potential 
victims, families and colleagues to 
recognise the signs of financial abuse 
and to offer support where needed; and 
––launching our Age Friendly Banking 
initiative in Hong Kong to assist seniors 
to better understand key concepts  
and services such as third-party carer 
banking, digital banking and scam 
prevention. 
Supporting financial inclusion  
We work with trade associations, 
governments and regulators to identify 
barriers to financial inclusion and find 
ways to improve standards and share 
best practice. For example, in 2018: 
––We chaired trade body UK Finance’s 
Financial Inclusion and Capability 
working group and were involved with its 
Vulnerability sub-group; we were part of 
a cross-Whitehall working group, which 
brings together the government, banks 
and policymakers to develop strategies 
on how UK banks can safely transfer 
We believe that in order for people to 
access and make the most of financial 
services they need to understand how  
to use them effectively to establish and 
grow their wealth. To deliver this in 2018:
––We delivered more than 1,000 financial 
well-being seminars in the US, UK, 
Mexico, Singapore and Australia, 
reaching more than 26,000 people 
including more than 2,100 HSBC 
funds to high risk and sanctioned 
jurisdictions; and we provided 
organisational and staffing support, 
including the chairmanship, to the  
UK Financial Inclusion Commission.
––In Asia-Pacific we hosted an insurance 
industry event as part of the annual Out 
Leadership summit, where we shared 
changes made in our business to 
recognise modern family relationships, 
and encouraged the industry to 
become more inclusive in their 
products and services. 
employees, as part our RBWM’s  
Your Financierge service.
––We began refreshing the content we 
share on our public websites, including 
introducing guides to modern money 
on our UK site. 
––We launched an online platform in the 
US with EVERFI to help our customers 
and communities better understand 
day-to-day money management and 
preparing for the future. 
We believe that diversity helps us to fulfil 
our potential. We apply this philosophy to 
our products and channels to help ensure 
they are inclusive and accessible for 
individuals and SMEs. To deliver this in 2018:
––We improved our digital accessibility in 
10 of our retail banking markets, so that 
more customers can access online 
banking. We also made physical services 
more accessible by starting a ‘barrier-free 
banking’ programme in Hong Kong to 
upgrade our branch and ATM networks. 
––We offered low- or no-fee banking 
services in selected markets for 
individuals who may not qualify for our 
products. These services are provided 
through basic accounts or waivers of 
minimum balance requirements. 
––We expanded the beneficiary definitions 
of our life insurance policies in Hong 
Kong to recognise a broader range of 
family relationships such as stepchildren 
and same-sex couples. 
––We helped people experiencing cognitive 
decline access and maintain banking 
services through our Independence 
Service initiative in the UK, and through 
our new Living with Dementia 
programme in Hong Kong. 
––We expanded the use of third-party 
alliances in Mexico so our customers 
now have 10% more locations where 
they can deposit cash and pay bills. 
––We announced a £12bn fund to lend to 
SMEs in the UK, and continued to be a 
shareholder in BGF Group plc (‘BGF’), 
formerly the Business Growth Fund. 
BGF provides patient equity capital to 
support SMEs across the UK and 
Ireland. In 2018, the Canadian Business 
Growth Fund, which we helped to 
promote and in which we are an 
investor, made its first investments.   
Engagement with partners
Access to financial education content
Access to products and services
44
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
A responsible business culture

Additional  
information
45
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

This ESG Update may contain projections, 
estimates, forecasts, targets, opinions, 
prospects, results, returns and forward-
looking statements with respect to the 
financial condition, results of operations, 
capital position, strategy and business of 
the Group, which can be identified by the 
use of forward-looking terminology such 
as ‘may’, ‘will’, ‘should’, ‘expect’, 
‘anticipate’, ‘project’, ‘estimate’, ‘seek’, 
‘intend’, ‘target’ or ‘believe’ or the 
negatives thereof or other variations 
thereon or comparable terminology 
(together, ‘forward-looking statements’), 
including the strategic priorities and any 
financial, investment and capital targets 
described herein. Any such forward-
looking statements are not a reliable 
indicator of future performance, as they 
may involve significant stated or implied 
assumptions and subjective judgements, 
which may or may not prove to be 
correct. There can be no assurance that 
any of the matters set out in forward-
looking statements are attainable, will 
actually occur or will be realised or  
are complete or accurate. Certain of the 
assumptions and judgements upon which 
forward-looking statements regarding 
strategic priorities and targets are based 
are discussed under ‘Targeted Outcomes: 
Basis of Preparation’, available separately 
from this ESG Update at www.hsbc.com. 
The assumptions and judgements may 
prove to be incorrect and involve known 
and unknown risks, uncertainties, 
contingencies and other important 
factors, many of which are outside  
the control of the Group. Actual 
achievements, results, performance or 
other future events or conditions may 
differ materially from those stated, implied 
and/or reflected in any forward-looking 
statements due to a variety of risks, 
uncertainties and other factors (including 
without limitation those that are referable 
to general market conditions or regulatory 
changes). Any such forward-looking 
statements are based on the beliefs, 
expectations and opinions of the Group  
Additional information
at the date the statements are made, and 
the Group does not assume, and hereby 
disclaims, any obligation or duty to 
update, revise or supplement them if 
circumstances or management’s beliefs, 
expectations or opinions should change. 
For these reasons, recipients should not 
place reliance on, and are cautioned 
about relying on, any forward-looking 
statements. No representations or 
warranties, expressed or implied, are 
given by or on behalf of the Group as to 
the achievement or reasonableness of any 
projections, estimates, forecasts, targets, 
prospects or returns contained herein.
Additional detailed information 
concerning important factors that could 
cause actual results to differ materially 
from this ESG Update is available in our 
Annual Report and Accounts 2018 for  
the fiscal year ended 31 December 2018 
filed with the Securities and Exchange 
Commission (‘SEC’) on Form 20-F on  
20 February 2019.
Cautionary statement regarding forward-looking statements
This ESG Update contains non-GAAP 
financial information. The primary 
non-GAAP financial measures we  
use are presented on an ‘adjusted 
performance’ basis, which is computed 
by adjusting reported results for the 
period-on-period effects of foreign 
currency translation differences and 
significant items, which distort  
period-on-period comparisons. 
Significant items are those items  
that management and investors  
would ordinarily identify and consider 
separately when assessing performance 
in order to better understand the 
underlying trends in the business.
Reconciliations between non-GAAP 
financial measurements and the  
most directly comparable measures 
under GAAP are provided in our 2018 
Form 20-F and the corresponding 
Reconciliations of Non-GAAP Financial 
Measures document, each of which  
are available at www.hsbc.com.
Non-GAAP financial information
46
HSBC Holdings plc Environmental, Social and Governance Update, April 2019

Abbreviations
Currencies
£
British pound sterling
$
United States dollar
A
AI
Artificial intelligence
AML
Anti-money laundering
AML DPA
Five-year deferred prosecution agreement with the US 
Department of Justice, entered into in December 2012
C
CET1¹
Common equity tier 1
CMB
Commercial Banking, a global business
D
DoJ
US Department of Justice
DPA
Deferred prosecution agreement
E
ESG
Environmental, social and governance
ESG Guide
Environmental, Social and Governance Reporting Guide 
contained in Appendix 27 to The Rules Governing the Listing 
of Securities on the Stock Exchange of Hong Kong Limited
EU
European Union
Euribor
Euro interbank offered rate
F
FCA
Financial Conduct Authority (UK)
FRB
Federal Reserve Board (US)
FSVC
Financial System Vulnerabilities Committee 
FTE
Full-time equivalent staff
FX
Foreign exchange
FX DPA
Three-year deferred prosecution agreement with the US 
Department of Justice, entered into in January 2018
G
GAAP
Generally accepted accounting principles
GB&M
Global Banking and Markets, a global business
GCB
HSBC’s global career band structure
GDPR
General Data Protection Regulation
GLCM
Global Liquidity and Cash Management
Global 
Markets
HSBC’s capital markets services in Global Banking and 
Markets
GMB
Group Management Board
GPB
Global Private Banking, a global business
Group
HSBC Holdings together with its subsidiary undertakings
GSS
Green, social and sustainable
H
HMRC
HM Revenue and Customs
Hong Kong
Hong Kong Special Administrative Region of the People’s 
Republic of China
HOST
HSBC Operations Services and Technology
HSBC
HSBC Holdings together with its subsidiary undertakings
HSBC 
Holdings
HSBC Holdings plc, the parent company of HSBC
HSBC UK
HSBC UK Bank plc
I
IEPS
International Education Payment Solution
IFRSs
International Financial Reporting Standards
The ILO 
Declaration
International Labour Organization Declaration on 
Fundamental Principles and Rights on Work
J
Jaws
Adjusted jaws measures the difference between the rates of 
change in adjusted revenue and adjusted operating expenses.
K
KYC
Know your customer
L
LEED
Leadership in Energy and Environmental Design
LGBT+
Lesbian, gay, bisexual and transgender. The plus sign 
denotes other non-mainstream groups on the spectrums of 
sexual orientation and gender identity
Libor
London interbank offered rate
M
Mainland 
China
People’s Republic of China excluding Hong Kong
N
NDPE
No deforestation, no peat, and no exploitation
NGO
Non-governmental organisation
P
PPA
Power purchase agreement
PPI
Payment protection insurance
PRA
Prudential Regulation Authority (UK)
R
RBWM
Retail Banking and Wealth Management, a global business
RMBS
Residential mortgage-backed securities
RMM
Risk Management Meeting of the Group Management Board
RoE
Return on equity
RoTE
Return on tangible equity
RSPO
Roundtable on Sustainable Palm Oil
S
SDGs
United Nation’s Sustainable Development Goals
SEC
Securities and Exchange Commission
SMEs
Small and medium-sized enterprises
SQA
Sales quality assurance
SRI
Socially responsible investment
T
TCFD¹
Task Force on Climate-related Financial Disclosures
U
UAE
United Arab Emirates
UDHR
Universal Declaration of Human Rights
UK
United Kingdom
UN
United Nations
UNGPs
UN Guiding Principles
UN PRI
United Nations Principles of Responsible Investment
US
United States of America
Unless the context requires otherwise, 
‘HSBC Holdings’ means HSBC Holdings 
plc and ‘HSBC’, the ‘Group’, ‘we’, ‘us’ 
and ‘our’ refer to HSBC Holdings 
together with its subsidiaries. Within 
this document the Hong Kong Special 
Administrative Region of the People’s 
Republic of China is referred to as  
‘Hong Kong’. When used in the terms 
‘shareholders’ equity’ and ‘total 
shareholders’ equity’, ‘shareholders’ 
means holders of HSBC Holdings 
ordinary shares and those preference 
shares and capital securities issued by 
HSBC Holdings classified as equity.  
The abbreviations ‘$m’, ‘$bn’ and ‘$tn’ 
represent millions, billions (thousands  
of millions) and trillions of US dollars, 
respectively.
Certain defined terms
1. A full definition is included in the glossary to the Annual Report and 
Accounts 2018 which is available at www.hsbc.com/investors.
47
Additional information
A responsible  
business culture
Supporting  
sustainable growth
Employees
Customers
Overview
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Additional information

Employee photos: All the photos on the inside pages of this report, with the exception  
of the Group Chief Executive profile picture on page 2, were taken by people working  
for HSBC in locations including the UK, Hong Kong, Bangladesh and India. Many more 
employees across the Group’s international network have contributed to HSBC Now 
Photo, an ongoing project that allows them to demonstrate their talent as photographers 
and show the diversity of the world around them.
Cover: Our global marketing campaign explores how HSBC helps people prosper.  
The Group’s iconic hexagon becomes a lens through which to look at the world,  
showing how we help individuals, businesses and communities to grow and flourish.  
This includes our commitment to the development of renewable energy sources that  
can support the global transition to a low-carbon economy. We have pledged to  
provide $100 billion in sustainable financing and investments by 2025.
Inside front cover: Moraine Lake, near Banff National Park, Canada. This picture  
was taken by Harsha Aruru, who works for HSBC in New York as an IT developer.
Page 7: Popinjays restaurant, Hong Kong. This picture was taken by Terry Tam,  
who works for HSBC in Hong Kong as an IT developer.
Pages 20/21: Pottery, district of Sylhet in Bangladesh. This picture was taken  
by Talukdar Noman Anwar, who works for HSBC as Head of Communications  
in Bangladesh.
Page 26: Thrunton Woods, Northumberland UK. This picture was taken by  
Ciara Jennings, who works for HSBC in the UK’s digital technology team.
Page 36: Mont Blanc range in France. This picture was taken by Jo Eaton,  
who works for the HSBC UK Insurance department.
Page 45: The Corridor of Life, the Chowmohalla Palace in Hyderabad in India. This picture  
was taken by Alok Kumar Tripathy, who works for HSBC’s HR Operations team in India.
Inside back cover: Cherry blossoms, South Korea, Gangwon province, Hwacheon 
Aquatic Resort. This picture was taken by Nicole Yau Suk Yin, who works for the 
department of Underwriting and Claims for HSBC Hong Kong.
Photography 
© Copyright HSBC Holdings plc 2018
All rights reserved 
No part of this publication may  
be reproduced, stored in a retrieval 
system, or transmitted, in any form or  
by any means, electronic, mechanical, 
photocopying, recording, or otherwise, 
without the prior written permission of 
HSBC Holdings plc. 
Published by Global Finance,  
HSBC Holdings plc, London 
Designed and produced  
by Superunion, London  
www.superunion.com
Useful links
In this section, we have provided further 
information on HSBC’s approach to ESG 
issues. It contains links to further content, 
policies and topics discussed in this 
document. Please visit the links to obtain  
a more in-depth understanding of our 
initiatives covering the ESG issues that  
may be of interest to you.
For further information on our approach and 
measuring our impact, see www.hsbc.com/
our-approach/measuring-our-impact. On  
this area of our website you will find latest 
reports, statements and policies, including:
––Communication on progress to UN 
Principles for Responsible Investment
––Communication on progress to UN 
Principles for Sustainable Insurance
––Environmental, Social and Governance 
Update, April 2017
––Environmental, Social and Governance 
Supplement, November 2017
––Environmental policy
––Health and safety policy
––HSBC Holdings plc Board diversity  
and inclusion policy
––HSBC’s $100bn sustainable financing and 
investment commitment – data dictionary
––PricewaterhouseCoopers LLP – Assurance 
report for 2018 – sustainable finance
––Remuneration practices and governance
––Reporting guidelines – carbon emissions
––Statement on human rights
––Statement on climate change
––Statement on conduct
––Statement on public policy engagement
––Strategic Report 2018
––Sustainability memberships
––UK Gender Pay Gap 2017/2018
––Whistleblowing statement
Other relevant website links include:
––Financial Crime Risk policies (including 
anti-money laundering, sanctions, and 
anti-bribery and corruption):  
www.hsbc.com/our-approach/risk-and-
responsibility/financial-crime-risk/financial-
crime-risk-policies
––HSBC Centre of Sustainable Finance:  
www.sustainablefinance.hsbc.com
––Corporate governance (including our 
governance framework and board 
responsibilities): www.hsbc.com/our-
approach/corporate-governance
––Modern Slavery Act statement:  
www.hsbc.com/our-approach/risk-and-
responsibility/modern-slavery-act
––Sustainability Risk policies (including 
Equator Principles):  
www.hsbc.com/our-approach/risk-and-
responsibility/sustainability-risk
––Green and sustainability bond frameworks 
and impact reports:  
www.hsbc.com/investors/fixed-income-
investors/green-and-sustainability-bonds
––Working with suppliers:  
www.hsbc.com/our-approach/risk-and-
responsibility/working-with-suppliers
––Building a sustainable future (including 
sustainable finance and sustainable 
operations): www.hsbc.com/our-
approach/building-a-sustainable-future
––Our approach to risk and responsibility 
(including health and safety and tax 
transparency): www.hsbc.com/our-
approach/risk-and-responsibility
48
HSBC Holdings plc Environmental, Social and Governance Update, April 2019
Additional information

Printed by Park Communications on FSC® 
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Park is EMAS certified company and its 
Environment Management System is certified 
to ISO14001. This document is printed on
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HSBC Holdings plc
8 Canada Square
London E14 5HQ
United Kingdom
Telephone: 44 020 7991 8888
www.hsbc.com