I have always been asked what constitute a good ESG report. Of course, it depends on the purpose of the audience. A general retail investor would have a very different perspective from a professional sustainable investor.
I read tens of ESG reports every day, and notice that the length of them varies a lot. Does the number of pages give us some indications?
Let’s take a look at two latest ESG reports published last week on HKEX website. One of them comes from the construction sector, and the other is a telecommunication company. One has 72 pages, and the other has 13 pages.
For the longer one, its design is quite colourful and attractive. But frankly, 73 pages is a bit too long for me. I have basically skipped most of the pages between the Chairman’s message and the carbon emission table.
For the shorter one, no super fancy design. Kind of plain text primarily. 13 pages is still quite something for me. I jumped to the carbon emission number straight away.
After all, I guess what matters to me is their ESG performance. Are they doing better than the peers? Have they been improving year by year. Of course, I will look at their approach and management commitment towards continuous improvement.
What elements will you look at in an ESG report, and factors to consider if it is a good one. Any comments are welcome.
The reported carbon emission for year 2019 is 65,097 kg.
Hanison Construction Holdings Limited (HCHL/The Group)
(Stock Code: 896) (72 pages)
The reported GHG emission for year 2019-20 is 2,336.92 tonnes CO2e.