The Hong Kong Institute of Certified Public Accountants is 
the only body authorized by law to register certified public 
accountants and grant practising certificates in Hong 
Kong. The Institute has more than 47,000 members and 
more than 17,500 students. Members of the Institute are 
entitled to the description "certified public accountant" and 
to the designation CPA.

Contents
Message from the chair of the 2021 Best Corporate 
Governance and ESG Awards Judging Panel……………………...…. .
Background……………………………………………………………
1. What is the overall percentage of companies with ESG 
assurance?……………………………………………………………
2. What are the percentages of companies by market 
capitalization with ESG assurance?………………………………
3. What types of assurance do companies use?………………
4. What is the scope of assurance?……………
5. What benchmarks do companies use to prepare their 
reports?………………………………………………………………
6. What standards do assurers use to assure ESG reports?………
7. Who are the assurers of ESG reports?…………………………… 
8. Are the ESG assurers the same as the financial statement 
auditors?………………………………………………………………
Findings, observations and recommendations……………………
Page
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1
1 https://www.ifrs.org/groups/international-sustainability-standards-board/ 
Message from the chair of the 2021 Best Corporate Governance and 
ESG Awards Judging Panel
Dear members,
It is pleasing to see more companies integrating their environmental, social and governance 
(ESG) vision, strategies and action plans into their corporate agenda, and disclosing quite 
extensive ESG information, enabling investors to make informed investment decisions and 
allocate capital more efficiently. Meanwhile, with the ESG information provided by 
companies, other stakeholders are also better able to judge whether those companies are 
genuinely committed to implementing good ESG practices and disclosures, and to making 
their own contribution towards long-term sustainable development.
Given that an increasing number of stakeholders are relying on good quality of ESG 
information, attention is also turning to the accuracy, reliability and integrity of such 
information in order to enhance the stakeholders’ confidence in it. The need for some form of 
external validation or assurance of ESG reporting, akin to that provided by auditors in 
relation to financial information, is now the subject of discussion. However, at present there 
are no internationally agreed standards for ESG reporting as there are for financial reporting. 
Various different frameworks and sets of guidance for non-financial and ESG reporting, or 
specific aspects thereof, such as climate change, have been developed by different 
organizations, some of which have quite been widely adopted or used as benchmarks.
While there has been some consolidation over the past couple of years - in particular the 
International Integrated Reporting Council (IIRC) and Sustainability Accounting Standards 
Board (SASB) merged in 2021 to form the Value Reporting Foundation (VRF) - the disparate 
and dispersed efforts to support ESG reporting have made it difficult for companies to know 
what benchmarks to report against, particularly for those seeking international investment. 
This, in turn, has also made it problematic for investors and other stakeholders to make 
comparisons between the ESG-related disclosures of different companies’ and, where there 
is assurance, also the assurance provided on those disclosures.
Therefore, the announcement by the Trustees of International Financial Reporting Standards 
(IFRS) Foundation, at the 26th UN Climate Change Conference of the Parties (COP26), held 
in Glasgow, 31 October - 12 November 2021, of the formation of a new International 
Sustainability Standards Board (ISSB)1 to develop, in the public interest, a comprehensive 
global baseline of high-quality sustainability disclosure standards to meet investors’ 
information needs, was very welcome; as was the commitment by the VRF and the Climate 
Disclosure Standards Board to consolidate into the new board by June 2022.
With these landmark developments, over time, we hope to see both ESG reporting, and 
assurance provided on it, coalesce into something that is extensive, reliable and credible, as 
well as being harmonized and comparable on a global level. We also believe that, by virtue 
of their training, experience and skill sets, as well as their professional ethics and the 
requirement for them to undertake continuous professional development, accountants are 
well placed to play a pivotal role in the further development of ESG reporting and assurance.

2
2 https://www.hkicpa.org.hk/-/media/HKICPA-Website/New-HKICPA/Standards-and-regulation/SSD/03_Our-views/TB_-
Cir/Auditing/aatb5_20.pdf
Message from the chair of the 2021 Best Corporate Governance and 
ESG Awards Judging Panel (cont’d)
This report reflects a snapshot of where Hong Kong listed companies stand at the present 
time with regard to ESG assurance. Currently, while it is encouraged to some extent, it is not 
a mandatory requirement under the local rules and regulations, and, in practice, only a 
relatively small percentage of the listed companies in Hong Kong opt to obtain any form of 
external assurance. Those that do tend to obtain limited scope engagements on specific 
information rather than the more extensive reasonable assurance across the broad spectrum 
of their ESG data and reporting. 
While it may be some time before there is a consensus about regulation around assurance, 
given that ESG reporting standards themselves are still at a relatively early stage of 
evolution, obtaining a degree of assurance over a company’s ESG information and data from 
a reputable, professional firm can help companies to build trust with investors and drive their 
competitive advantage. This may be why a number of CPA firms are increasing resources 
into developing and enhancing their ESG-related services to serve the needs of their existing 
and future clients. To support our members in practice, the Institute has published Auditing 
and Assurance Technical Bulletin (AATB) 5 Environmental, Social and Governance (ESG) 
Assurance Reporting2, providing practical non-authoritative support material to assist 
practitioners in performing ESG assurance engagements, in accordance with Hong Kong 
Standard on Assurance Engagements 3000 (Revised) Assurance Engagements Other than 
Audits or Reviews of Historical Financial Information.
Finally, in the context of seeking to strengthen ESG reporting, it is also important to stress 
that boards and managements, and preparers, should devote adequate and proper attention 
to ensuring the quality and reliability of their own ESG-related information and non-financial 
reporting generally.
Raymond Cheng FCPA (practising)
2021 Institute President 
and Chair of the 2021 Best Corporate Governance and ESG Awards Judging Panel

Background
In view of the accelerating demand for good quality ESG information, obtaining some 
assurance on ESG reports is also becoming important in helping to build stakeholders’ trust 
in the quality of the information disclosed. The Hong Kong Stock Exchange’s (HKEX) 
upgraded Environmental, Social and Governance Reporting Guide (ERG), which is under 
the Listing Rules (Appendix 27 of Main Board Listing Rules and Appendix 20 of the GEM 
Listing Rules), also notes that companies may seek independent assurance to strengthen 
the credibility of ESG information. 
In some jurisdictions, the local equivalents of HKEX’s ERG guidance go even further. As 
noted in the Asian Corporate Governance Association’s (ACGA) recent update of its CG 
Watch comparative study3 on corporate governance across Asia, the Singapore Exchange’s 
sustainability reporting guide offers a succinct rationale for assurance and recommends 
phasing it in:
“Independent assurance increases stakeholder confidence in the accuracy and 
completeness of the sustainability information disclosed. An issuer whose sustainability 
reporting has already matured after several annual exercises would want to undertake 
external assurance by independent professional bodies to add credibility to the information 
disclosed and analysis undertaken. An issuer new to sustainability reporting may wish to 
start with internal assurance before progressing to external assurance for its benefits. The 
issuer should also consider whether it would be worthwhile to undertake independent 
external assurance on selected important aspects of its report even in its initial years, 
expanding coverage in succeeding years.”
As reported in July, the Institute initiated a brief research exercise on the ESG assurance 
status of all 55 Hang Seng Index-constituent companies, investigating those that had 
published their sustainability/ESG report or incorporated a sustainability/ESG section in their 
annual reports for 2020/21, as at 28 June 2021. While 49 of them had published this ESG 
information by the cut-off date, only 23 out of 49 companies, i.e. around 47%, also sought 
external assurance on the information disclosed.
The situation of the Hang Seng Index-constituent companies, however, shows only a small 
part of the story. To further investigate the prevailing ESG assurance practices among listed 
companies more generally, the Institute has taken a broader look at listed companies with 31 
December 2020 as their fiscal year-end date, scanning roughly 1,900 companies. These 
were allocated into the 89 categories identified by AASTOCKS.COM LIMITED.
In general, we were able to derive some useful statistics based on asking the questions set 
out below, and with the able support of a group of undergraduate students. 
3 CG Watch 2020, Future Promise - Aligning governance and ESG in Asia (ACGA & CLSA, May 2021), page 11.
3

Background (cont’d)
Regulatory requirements 
•
As mentioned above, the focus of this research was on listed companies with a 
financial year ended 31 December 2020. It seems that all of the companies included in 
the research published their ESG-related information either in their annual or ESG 
reports, generally, based on the ERG. At the time the companies were preparing their 
ESG reports, the relevant version of the ERG contained a mix of “comply-or-explain” 
provisions and recommended disclosures4. The “comply-or-explain” provisions 
covered general disclosures relating to policies and compliance with relevant law and 
regulations that had a significant impact on the company, in relation to each of the 
different aspects of ESG, and also additional disclosure of certain key performance 
indicators (KPIs) under the Environmental section. The recommended disclosures 
covered various KPIs in the Social section of the ERG.
•
The ERG complements paragraph 28(2)(d) of Appendix 16 of the Main Board Listing 
Rules (and rule 18.07A(2)(d) of the GEM Rules), which states that an issuer’s 
directors’ report for a financial year must contain a business review in accordance with 
schedule 5 to the Companies Ordinance (Cap. 612). The business review must 
include, to the extent necessary for an understanding of the development, performance 
or position of the issuer’s business:
i.
a discussion of the issuer’s environmental policies and performance;
ii.
a discussion of the issuer’s compliance with the relevant laws and 
regulations that have a significant impact on the issuer; and
iii.
an account of the issuer’s key relationships with its employees, customers 
and suppliers and others that have a significant impact on the issuer and on 
which the issuer’s success depends.
•
So for quite a number of December 2020-year-end companies, their ESG disclosures 
were a combination of “comply-or-explain” requirements and voluntary disclosures. 
Looking ahead to next reporting cycle, these companies will now be subject to the 
upgraded version of the ERG, which includes a number of mandatory disclosure 
requirements relating to ESG governance structure, reporting principles and reporting 
boundary, as well as “comply-or-explain” requirements for all the KPIs in the both the 
Environmental and Social sections of the report5. These new provisions took effect for 
listed companies for financial years commencing on or after 1 July 2020.
4 See: https://en-rules.hkex.com.hk/node/3841/revisions/5218/view
5 See: https://en-rules.hkex.com.hk/sites/default/files/net_file_store/HKEX4476_3841_VER20.pdf
4

5
1. What is the overall percentage of companies with ESG assurance?
The results show that only a very limited number of companies overall obtained assurance on their 
ESG reporting. Among the 1,897 companies included in the research, only 85 (4.5%) of them 
obtained external assurance. This figure includes 17 Hang Seng Index constituent companies. It 
suggests that at this stage, most listed companies in Hong Kong do not see the benefits of 
assurance. It may also be indicative of other factors – for example, that they see ESG reporting as 
primarily an issue of compliance and, currently, obtaining assurance is not a requirement, or that 
they are not entirely confident in the data and other information that they are reporting on. This 
merits further exploration.
Among the 85 companies with assurance, banks accounted for over 30%. This may be because 
banks are more attuned to ESG issues, given that the Hong Kong Monetary Authority (HKMA) has 
introduced various measures on sustainable banking and green finance and, at the international 
level, the recommendations of the Financial Stability Board’s Task Force on Climate-Related 
Financial Disclosures (TCFD) have been gaining increasing prominence. 
The second highest number was among the insurance sector, albeit accounting for only 6%. This 
suggests that the financial services sector, more generally, views independent validation of ESG 
reporting as relatively more important. The rest of the companies with ESG assurance were almost 
evenly distributed across other industry categories, ranging from 1 to 5%. Industries where 
companies with assurance each represented only 1% of the total have been consolidated into 
“other” category for ease of presentation.
32%
6%
5%
5%
5%
5%
4%
4%
2%
2%
2%
2%
2%
2%
2%
20%
Analysis by sector of companies with 
ESG assurance 
Bank
Insurance
Airline services
Conglomerates
Property investment
Telecommunication services
Gas supply
Marine and habour services
Dairy products
E-commerce & internet services
Electricity Supply
Medicine
Nonferrous metal
Petroleum & gases
Property development
Others

6
6 https://www.ifac.org/system/files/publications/files/IFAC-Benchmarking-Global-Practice-Sustainability-Assurance.pdf
1. What is the overall percentage of companies with ESG assurance? 
(cont’d)
Earlier this year, the International Federation of Accountants, together with the American Institute of 
Certified Public Accountants and the Chartered Institute of Management Accountants embarked on 
a global benchmarking study6 in partnership with Audit Analytics (IFAC study), The State of Play in 
Sustainability Assurance sought to better understand the extent to which companies were reporting 
and obtaining assurance over their sustainability disclosures, which assurance standards were 
being used, and which companies were providing the assurance service. 
The IFAC study reviewed 1,400 companies across twenty-two jurisdictions, of which 51% reported 
sustainability information with some level of assurance on it. While, prima facie, this would indicate 
that the assurance rate of Hong Kong listed companies identified in our research of around 4.5% 
significantly lags behind the global benchmark, such a comparison may be imprecise. The IFAC 
study looked at, on average, 64 of the largest companies in each jurisdiction covered, while our 
study covered around 1,900 companies of all different sizes. As noted above, our earlier research 
on HSI-constituent companies which had published ESG reports by a cut-off date, found that 
around 47% also sought external assurance. This is not dissimilar to the figure in the IFAC study.

7
2. What are the percentages of companies by market capitalization with 
ESG assurance?
Our assurance research covered the 1,890 companies with 31 December 2020 as their financial 
year end. Applying the market capitalization adopted to classify different size companies under 
large (HK$54 billion and above), mid (over HK$9 billion and below HK$54 billion) and small (up to 
HK$9 billion) market capitalization (cap) categories in our Best Corporate Governance and ESG 
Awards 2021, we arrive at the numbers of companies in the large-, mid- and small-cap categories 
included in our study indicated below. The results are as follows:
It is not a surprise to find that the companies in the large-cap category have a significantly higher 
percentage of ESG reports with some level of assurance, as already suggested by our earlier 
research on HSI-constituent companies, and that a very low percentage of the companies in small-
cap category have any ESG assurance Large- and the bigger mid-cap companies would tend to 
have more resources to devote to their ESG. They would be more likely to be aiming to attract 
international investors, including institutional investors, whose expectations, generally, in terms of 
ESG reporting are increasing.
Categories
Number of 
companies
Number of the 
companies with 
ESG assurance
Percentage
B/A * 100%
Large
144
29
20.1%
Mid
309
36
11.6%
Small
1,437
20
1.4%

8
68%
14%
18%
Types of assurance
Limited
Reasonable
Not indicated
3. What types of assurance do companies use?
Nearly 70% of the sample that obtained assurance obtained limited assurance with 14% obtaining 
reasonable assurance.
This seems to be in line with the international trend. At present, KPMG note7, due to the relative 
immaturity of ESG reporting and the associated cost/benefit, most opinions are limited assurance. 
Whilst the scope of financial statement audits and reviews covers the whole statement and 
disclosures, for ESG reporting, most of the time it will be selected KPIs or a specific section of the 
ESG report or annual report.
Reasonable assurance in general requires more effort than limited assurance. This is because it 
implies a similar level of assurance as for a financial statement audit and the need to obtain 
sufficient evidence.
Limited assurance engagements on the other hand are not as robust and, therefore, the cost is 
lower. This may be one reason why, at this stage, when assurance is voluntary, many companies 
prefer to opt for limited assurance. Other reasons may be the lack of common standards for ESG 
reporting, and that more attention and focus given to obtaining key data, such as data on 
greenhouse emissions, and having this assured, than to other information and data. They may, 
therefore, have less confidence in other data and so be more reluctant to subject it to assurance.
7 See https://home.kpmg/uk/en/blogs/home/posts/2021/02/esg-reporting-do-you-need-assurance.html

9
47%
16%
6%
22%
8%
Scope of assurance
Selected areas
Reliability of report content
The text, and data in
accompanying tables
Others
Not clear
4. What is the scope of assurance?
Nearly 50% of the companies in the sample indicated that only selected information/ data contained 
in the ESG reports was assured, while about 15% assured the reliability of their report content, 
which is considered a larger scope.
For 22% of the companies, the scope is classified as “others”. In most of the cases, the scope 
seemed to cover the entire report but then proceeded to mention a specific focus on certain 
activities/ areas, or to cover ESG performance data and information, without indicating whether this 
was equivalent to the reliability of the report content as a whole.

10
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
HKEX
GRI
Others
Not indicated
Companies' ESG benchmark
5. What benchmarks do companies use to prepare their reports?
The ERG was quoted by more than 90% of the companies as one of the sources for preparing their 
ESG report. There is also a growing awareness of international standards and some are quite 
widely adopted. Our research indicated that almost 65% of the companies referred to the standards 
issued by the Global Reporting Initiative (GRI) in preparing their reports.
Remarks: 
•
These percentages do not add up to 100 as many of the companies prepared their reports 
with reference to two or more standards.
•
Our focus was on standards referred to in ESG assurance reports, rather than other 
benchmarks that may also be mentioned in the body of ESG report, such as the 17 United 
Nations Sustainable Development Goals, TCFD recommendations, etc. By definition, those 
mentioned in the assurance report are more likely to be those standards and benchmarks 
most closely followed by the company concerned.

11
64%
24%
19%
12%
2%
Assurers' benchmarks
ISAE 3000
AA 1000v3
HKEX
GRI
NA
6. What standards do assurers use to assure ESG reports?
International Standard on Assurance Engagements (ISAE) 3000 Assurance Engagements Other 
than Audits or Reviews of Historical Financial Information issued by the International Auditing and 
Assurance Standards Board (IAASB), was the most commonly adopted assurance standard with 
64% of assurance reports in the study referring to this. The IAASB is an independent international 
standard-setting body that sets auditing and assurance standards.
The next most widely-referenced benchmark in our study was the AA1000 series of standards, 
which is applied by 24% of assurance reports. These are principles-based frameworks used by 
global businesses, private enterprises, governments, and other public and private organizations to 
reflect performance in accountability, responsibility, and sustainability. They are issued by 
AccountAbility, a global consulting and standards firm that works with businesses, investors, 
governments, and multilateral organizations on ESG matters.
Language of “adoption” 
In relation to questions 4 and 5 above, we noted that various different terminology was used to 
describe the way in which benchmarks were followed or taken into account, including “in 
accordance with”, “pursuant to”, “according to”, “based on”, “with reference to”. It appears that the 
former three terms are more indicative of close compliance with a particular benchmark than the 
latter two. In particular, companies seemed consider that they had greater flexibility to make use of 
certain parts, rather than the whole, of the relevant standard or benchmark when they used either 
of the terms “based on” or “with reference to”.

12
48%
52%
Assurers
CPA firms
Non-CPA firms
7. Who are the assurers of ESG reports? 
Firms of certified public accountants assured 48% of the reports. Non-CPA firms assured the rest, 
among which an assurance agency established in 1989 as a non-profit-distributing organization by 
the Hong Kong Government, seems to play a dominant role.

8. Are the ESG assurers the same as the financial statement auditors? 
In over 70% of the cases, the firm auditing the financial statements did not also assure the ESG 
report. This may be regarded as further enhancing the independence of ESG assurance but, on the 
other hand, there may be synergies where the financial statement auditors also perform the role of 
ESG assurers, particularly where ESG-related issues could have an impact on the financial 
statements, which may be increasingly the case in the future.
13
27%
73%
Yes
No
Whether the assurers are financial statement auditors

14
Findings, observations and recommendations
Findings
•
Overall, the penetration of assurance on ESG reporting is the listed company sector in 
Hong Kong is still very low. 
•
Based on our findings for December 2020 year-end companies, a significantly higher 
proportion of large-cap companies, around 20%, obtained assurance than for other 
categories. Only a very small proportion of small-cap companies, less than 1.5%, 
obtained assurance. These findings are not surprising given the more limited 
resources of most small-cap companies and that large-cap and the bigger mid-cap 
companies are more likely to be looking for international investment, including from 
institutional investors, who will want to be able place reliance on the integrity of ESG-
related information and data. 
•
Where there was assurance, the level of assurance was “limited” in over two thirds of 
the cases (68%) and “reasonable” in only 14% of cases, and it covered only selected 
areas of information in around half the cases (47%).
•
As regards industry sectors, the financial services sector and banks, in particular, had 
a significantly higher proportion of assured ESG reports than other sectors (amounting 
to almost one third of the total in the case of banks). This is likely to be the outcome of 
the focus on promoting sustainable banking and green finance by the HKMA, as well 
as the increasing prominence internationally of the recommendations of the TCFD. 
•
The limited penetration of assurance on ESG reporting is believed to stem from several 
factors, including the following:

Under the current regulatory regime, assurance is not mandatory and, in 
fact, not even a recommended best practice.

Currently, there are no generally accepted ESG reporting standards 
(although some, like the GRI, are quite widely referred to) other than the 
ERG under the listing rules in Hong Kong, which is deliberately non-
committal about specific reporting standards that companies may adopt.   

In 2020, the ERG contained only limited “comply-or-explain” provisions 
applicable to December-year-end companies, which included some key 
performance indicators in the Environmental section only. For companies 
with financial years starting on or after 1 July 2020, the latest, upgraded 
version of the guide will apply. So this will be generally applicable in the 
next reporting cycle.
•
Where assurance is obtained, in around 50% of cases, the assurer was a CPA firm. 
This is not surprising given that that main assurance benchmark referred to by all 
forms of assurers, in nearly two thirds of cases, was ISAE 3000, issued by the IAASB. 
Accountants will naturally be more experienced and adept at applying accounting-
related standards.
•
What may be more unexpected is that, where CPA firms undertook ESG assurance, it 
is generally not the company’s auditor. While this separation of roles may add to the 
perception of independence and stronger checks and balances, it may also work 
against the aim of achieving a deeper integration between ESG and financial reporting.

8 CG Watch 2020, Future Promise - Aligning governance and ESG in Asia (ACGA & CLSA, May 2021), page 13.
15
Findings, observations and recommendations (cont’d)
Observations and recommendations
•
With the establishment of the ISSB, it can be expected that fairly rigorous ESG 
reporting standards will be developed and promulgated quickly, starting with a 
standard on climate change. These standards are likely to be widely accepted and, 
around the world, regulatory frameworks may, over time, may be put in place to ensure 
the application of these standards, in a similar way to financial reporting standards. 
Companies should take the opportunity to adopt ESG reporting standards that can 
enhance the integrity, reliability and comparability of their reporting. As noted in the 
president’s introductory message to this report, boards and managements should also 
devote adequate and proper attention to ensuring the quality and reliability of their 
ESG reporting.
•
Against this background, companies can be more confident in starting to adopt, or to 
expand their assurance on their ESG information and data. This can help to validate 
and lend greater credibility to their ESG reporting. With the increased harmonization 
and comparability of standards that is likely to occur, investors will have more trust and 
confidence in companies’ reported ESG performance, which will be enhanced by the 
added comfort provided by assurance.
•
In addition, with the more extensive requirements of the revised ERG now in effect, this 
is an appropriate time for companies new to this journey to start considering what data 
and information should be a priority for assurance, if they do not feel comfortable 
seeking assurance on all of their ESG reporting. They should consider focusing initially 
on data that is most material to them and their stakeholders. Good stakeholder 
engagement processes and the development of a sound materiality matrix can help to 
identify the key information and data.
•
Noting the very varied landscape alluded to in the president’s message and the 
present  lack of comparability in assurance, the ACGA makes two suggestions for 
moving the process forward8: 
“First, encourage the content of ESG reports to be independently reviewed for 
their breadth and depth of coverage, with recommendations made as to how they 
could improve and be made more useful for investors in particular. This does not 
envisage assuring all the data points, rather taking a more selective approach to 
addressing issues that are most material to a company’s business. 
Secondly, if an ESG risk is material enough to have a major financial or business 
impact, it should be discussed in the annual report and assessed alongside the 
financial statements. The obvious candidate is climate change. Indeed, some 
global institutional investors are starting to call for auditors to look at climate risk 
disclosure, in particular TCFD reporting, when auditing the financial statements.”

Findings, observations and recommendations (cont’d)
•
With the setting up of the ISSB, there is an opportunity for the accounting profession to 
play a larger role in supporting ESG reporting and assurance, which the profession 
should grasp. The accounting profession has the skill sets and understanding of key 
processes, including financial and data analysis, internal control and risk management, 
to take a leading role in ESG assurance, as well as reporting. Members of the 
profession are required to undertake continuous professional development, and are 
bound by, professional standards and a code of professional ethics.
•
Most assurers refer to the framework under ISAE 3000 in conducting their ESG 
assurance engagement. In this regard, not only are accountants more familiar with the 
application of this standard, they are trained in applying professional standards 
generally and may, ultimately, be subject to investigation and disciplinary action if they 
fail to apply a standard appropriately. This is not the case for other assurers, for whom 
ISAE 3000 is just a point of reference. They may inadvertently or deliberately fail to 
apply aspects of it without any direct repercussions.
•
There should be more discussion on the merits of a company’s financial statement 
auditor, supported by specific expertise, where needed, also being engaged to provide 
assurance on the company’s ESG report, as opposed to engaging a third party 
assurer, which could be a different CPA firm, to perform the latter function. Given the 
impact that ESG factors may have on the financial statements, having the same 
service provider perform both roles could help facilitate integration of financial and 
ESG considerations, as well as corporate governance and ESG, which is something, 
we believe, many regulators around the world, including HKEX, see as the goal.
•
In this regard, Deloitte note9 that ESG information may be highly interconnected with 
financial reporting. For example, knowledge obtained from financial statement audits, 
including internal controls, may be beneficial in planning the ESG assurance 
procedures (e.g., the auditors’ understanding of the business holistically across all of 
an organization’s functions, its industry, market forces, and why certain sustainability 
metrics are important financially as well as from a risk perspective).
9 https://www2.deloitte.com/content/dam/Deloitte/global/Documents/Audit/gx-audit-environment-social-and-governance-
considerations-corporate-reporting-and-assurance-basics.pdf
16