Company: HBCYF
Filing Date: 2025-02-20
Form Type: 20-F
Source: 0001089113-25-000040
Chunk: 74

Company: HSBC HOLDINGS PLC
Filing Date: 2025-02-20
Form: 20-F
Chunk 74
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 Model risk arises whenever business decision making includes reliance on models. We use models in both financial and non-financial contexts, as well as in a range of business applications. Evolving regulatory requirements are driving materialchanges to the way model risk is managed across the banking industry, with a particular focus on capital models. Newtechnologies, including AI and generative AI, are driving a need for enhanced model risk controls.                                                                                                                                                                                   |
| Change execution risk                                                                                     | }     | Delivering change effectively is critical to achieving our strategy and enables us to meet rapidly-evolving customer andstakeholder needs. We seek to deliver complex change in line with established risk management processes, prioritisingsustainable outcomes and understanding the associated risks. We focus on meeting industry and regulatory expectations andfulfilling our obligations to customers and clients.                                                                                                                                                                                                                                 |
| Risks associated withworkforce capability,capacity andenvironmental factorswith potential impacton growth | ~     | Our businesses, functions and geographies are exposed to risks associated with employee retention and talent availability,changing skills requirements of our workforce, and compliance with employment laws and regulations. Attrition across theGroup remains stable, but failure to manage these risks may impact the delivery of our strategic objectives or lead toregulatory sanctions or legal claims, and the risks are heightened during the current period of fundamental organisationalchange.                                                                                                                                                  |

~ Risk heightened during 2024 } Risk remained at the same level as 2023

| HSBC Holdings plcAnnual Report on Form 20-F | 39 |

Environmental, social and governance review Our ESG review sets out our approach to our environment, customers, employees and governance. It explains how we aim to achieve our purpose, deliver our strategy in a way that is sustainable, and build strong relationships with all of our stakeholders. How we present our TCFD disclosures Our overall approach to TCFD can be found on page 21 and additional information is included on pages 466 to 472 . Further details have been embedded in this section and the Risk review section on pages 249 to 258 . Our TCFD disclosures are highlighted with the following symbol:

| 40Environmental |
| 61Social        |
| 71Governance    |

Shanghai, China, 1870s. Waterfront View.

| TCFD |

| 40 | HSBC Holdings plcAnnual Report on Form 20-F |

ESG review | Environment

Environmental

| TCFD |

Transition to net zero We aim to support the transition to net