Against the backdrop of rising environmental, social and governance (ESG), green finance and sustainability issues, Fintech products and services that are oriented towards these areas can help provide quality data and tools to help individuals and institutions make optimal decisions. Our Fintech article in this edition of Banking Today takes a close look at the growing intersection between Fintech and ESG and the human capital skills and knowledge required to scale-up business models within the ESG and Fintech landscape.
隨環境、社會和管治 (ESG)、綠色金融和可持續發展問題日眾，應對相關範疇的金融科技產品和服務，有助提供優質數據和工具，協助個人和機構作出最佳決策。本期《今日銀行業》的金融科技專文，細察金融科技和 ESG 之間日益緊密的關係，以及在 ESG 和金融科技發展前景下擴大商業模式所需的人力資本技能和知識。
First published in the May/June 2022 edition of Banking Today, the official magazine of the Hong Kong Institute of Bankers (HKIB)
As environmental, social and governance (ESG) and sustainability factors become increasingly integrated into the banking and financial services sector, Fintech applications can act as a strategic enabler to help financial institutions to make better sustainable financing decisions based on actionable insights derived from data.
While Fintech solutions are not a one-stop panacea with the capability to solve every ESG and sustainable finance challenge, the growing suite of Fintech solutions can provide a useful lens through which to better analyse frameworks, standards, rankings and data to identify and establish key performance indicators (KPIs). Whether it is banks restructuring to adopt net zero pledges or developing new solutions to address climate-related issues, Fintech has a major role to play in achieving objectives that come under the ESG, sustainability and green finance umbrella. However, it is worth noting that ESG is not a predictable definition. As such, it is constantly evolving.
雖然金融科技解決方案不是一服靈丹妙藥，足以解決ESG和可持續金融面對的每個挑戰，但不斷充實的金融科技解決方案組合，可提供有用的透視鏡片，藉以更精準地分析架構、標準、排名和數據，從而識別和建立關鍵表現指標 (KPI)。無論是銀行重組以達致零排放承諾，還是開發新的氣候問題解決方案，金融科技都能發揮重要作用，達成 ESG、可持續性和綠色金融的一籃子目標。然而，值得注意的是，ESG 的定義並非一成不變，而是在不斷發展。
In a bid to become the regional and international “green financing” centre, in recent years, industry stakeholders in Hong Kong have continued to raise the bar for ESG and Fintech regulations, products and services. Unveiled in June 2021 with the aim of driving Fintech development in Hong Kong, the Hong Kong Monetary Authority (HKMA) launched its “Fintech 2025” strategy which provides a framework to encourage the city’s banking and finance sector to digitalise their operations from front-end to back-end by 2025. At the same time, the Hong Kong Securities and Futures Commission (SFC) has also introduced a number of initiatives to ensure participants in Hong Kong’s markets have access to decision-useful ESG information. Efforts such as the launch of Hong Kong’s green bonds scheme have been made to standardise green credentials and provide uniformity alongside greater transparency and instilling confidence in the markets.
為了成為區內和國際的「綠色金融」中心，香港的業界持份者近年不斷提高 ESG和金融科技的監管、產品和服務水平。為推動香港金融科技的發展，香港金融管理局 (金管局) 於 2021年6月推出「金融科技2025」策略，為鼓勵本地銀行和金融業於 2025 年之前全面數碼化營運提供框架。香港證券及期貨事務監察委員會 (證監會) 也同時推出多項措施，確保香港市場參與者能夠獲取有助決策的 ESG 資訊。香港推出綠色債券計劃，旨在規範綠色金融項目，在提供劃一標準的同時，也提高透明度並增強市場信心。
The Financial Services Development Council (FSDC) has also cited a number of policy recommendations for Hong Kong in order to strengthen the city’s status as a preferred ESG investment hub. Meanwhile, Cyberport and the Hong Kong Science Park – both of which provide incubation hubs for Fintech development in Hong Kong – actively facilitate collaboration between Hong Kong’s banking and finance sector and the city’s Fintech community. As the result of which, there are a number of examples of banks either partnering with or acquiring Fintech start-ups and firms in their late-stage development to bolster their ESG and sustainable finance capabilities.
金融發展局 (FSDC) 也提出多項政策建議，以加強香港作為首選 ESG 投資中心的地位。同時，數碼港和香港科學園都為香港金融科技發展提供孵化中心，積極促進香港銀行和金融業與本地金融科技界合作。在各方努力下，銀行為增強其 ESG 和可持續金融能力，夥拍或收購金融科技初創企業或處於後期發展階段的公司的例子屢見不鮮。
Adding further impetus to these positive tailwinds is the rapidly growing awareness that opportunities to confront ESG and sustainability challenges, and the interconnections to the banking and finance sector, are quickly running out. Furthermore, while strengthening Hong Kong’s Fintech and ESG capabilities with investment, oversight and reporting requirements is necessary, developing intellectual capacity is equally important to maintain a well-functioning ESG and green financing ecosystem.
進一步推動這股熱潮的，是越來越多人意識到，應付 ESG 和可持續發展的挑戰，以及與銀行和金融業建立緊密聯繫的機會稍縱即逝。此外，雖然有必要通過投資、監管和報告規定來加強香港的金融科技和 ESG 能力，但要維持運作良好的 ESG 和綠色金融生態系統，發展知識能力同樣重要。
Reliable data the key to robust decision making 可靠數據是穩健決策的關鍵
Without doubt, future growth of ESG and its interlinked connection to sustainable and green finance objectives is inextricably linked to data availability, accessibility,
reliability and comparability. Even though there are ESG-reporting standards such as the Sustainable Finance Disclosure Regulation (SFDR) and the Task Force on Climate-related Financial Disclosure (TCFD), currently ESG ratings largely rely on corporate disclosures. However, with an absence of a single binding global taxonomy, a diverse and confusing landscape of disclosure frameworks exists. This is further characterised by data collection and assessment methods developed and implemented in various markets and jurisdictions. In many cases, variation occurs not only between markets, but also within markets. Add to this the process of acquiring useful ESG data is often fragmented, frequently stored in non-digital systems across different sectors, causing difficulty to make informed ESG investment decisions.
毫無疑問，ESG 的未來發展，及其與可持續和綠色金融目標的相互扣連，與數據的可提供性、可獲取性、可靠性和可比較性息息相關。儘管 ESG 有一定的報告標準，例如可持續財務披露法規 (SFDR) 和氣候相關財務披露工作組 (TCFD) 的建議，但目前 ESG 評級主要依靠公司披露。然而，由於缺乏具約束力的單一全球分類法，披露框架存在多樣化和混亂的局面，而各個市場和司法管轄區訂定和實行各自的數據收集和評估方法，令情況更顯複雜。變化許多時不僅發生在市場之間，也發生在市場內部。 此外，獲取有用 ESG 數據的過程通常是零散的，有關數據經常儲存在不同業者的非數碼系統中，導致難以做出有資料根據的 ESG 投資決策。
As green investments increase in popularity, there has been a considerable upshift about how funds or products can qualify as green. Greenwashing, where reporting and disclosure practices are often insufficient or even misleading is an on-going challenge for financial institutions when evaluating the activities of their clients or developing financial investment tools.
Against this backdrop, Fintech tools including artificial intelligence (AI), machine learning (ML) and natural language processing (NPL) can be used to help to address fragmented, non-comparable ESG reporting and the lack of concise data. Fintech scenario analysis, for example, can be used to analyse corporates social responsibility performances alongside key financial indicators. Information can also be made into more easily digestible formats to assist investors in making more informed decisions. Meanwhile ESG frameworks can be aggregated and standardised into weighting systems, then combined with other criteria from investors to evaluate green credentials. For instance, in addition to growing amounts of traditional data, such as security prices, corporate financial statements, and economic indicators, alternative data generated from non-traditional data sources, such as social media and sensor networks, can now be integrated into a portfolio manager’s investment decision-making process.
在這背景下，包括人工智能 (AI)、機器學習 (ML) 和自然語言處理 (NPL) 在內的金融科技工具，有助解決分散、不可比較的 ESG 報告和缺乏簡明數據的問題。例如，金融科技情景分析可用於比對關鍵財務指標以分析企業社會責任成效。有關資料還可以製成更易於明瞭的格式，以幫助投資者做出更明智的決策。同時，ESG 框架可以綜合並標準化為加權系統，再結合投資者的其他標準，以評估綠色績效。舉例說，除了越來越多的傳統數據 (如證券價格、公司財務報表和經濟指標) 之外，從非傳統數據來源(如社交媒體和感測網絡) 產生的另類數據，現在都可以融合到投資組合經理的投資決策過程中。
In the area of financial record keeping, blockchain and distributed ledger technology (DLT) are creating new ways to record and track assets and financial transactions. Advances in AI-based techniques are enabling different data analysis approaches. For example, analysts are turning to artificial intelligence to sort through the enormous amounts of data from company filings, annual reports and earnings calls to determine which data are most important and to help uncover trends and generate insights relating to human sentiment and behaviour. Importantly, while the road to a low carbon future is potentially long and challenging, green Fintech can play a significant part in making this goal become a reality. Hong Kong, being the conduit between Mainland China and the West, has the potential to play a key role participating in Mainland China’s pledge to go carbon-neutral by 2060.
在財務紀錄保存方面，區塊鏈和分布式分類帳技術 (DLT) 正締造記錄和追蹤資產及財務交易的新方法。人工智能技術日趨進步，促成不同的數據分析方法。例如，分析師正轉用人工智能，分析來自公司文件、年報和業績公佈電話會議的大量數據，以確定哪些數據最重要，並協助發掘與人類情緒和行為相關的趨勢和新理念。重要的是，儘管通往低碳未來的路可能漫長而充滿挑戰，但綠色金融科技可以為實現此目標發揮有力作用。香港作為中國內地與東西方之間的通道，具有潛力在中國內地於2060年實現碳中和的承諾中扮演關鍵角色。
Establishing a common knowledge baseline 建立共同知識基線
With demand for ESG skills outpacing Hong Kong’s
talent supply, talent with the skills that intersect Fintech knowledge with an understanding of ESG and sustainability issues are in particularly short supply. Facing an absence
of suitable talent availability, financial institutions can create a strategic advantage by establishing a common baseline of relevant ESG workforce knowledge across the organisation. This can be achieved through internal learning and development programmes or with the assistance of a consultancy or a third-party that specialises in specific areas of ESG. As hybrid and virtual working models become more established, deploying virtual ESG training programmes offer several advantages. For instance, it is generally easier to remotely access experts with the relevant ESG expertise. Training programmes can also be tailored to specific individual or group needs. For example, individuals that work in trade finance need to understand the ESG implications relating to their client’s supply chain exposure.
由於對 ESG 技能的需求超過香港的人才供應，當中具有金融科技知識並能理解 ESG 和可持續發展問題的人才尤其短缺。面對合適人才短缺，金融機構可以在內部結合與 ESG 相關的工作知識為共同基線，以保持戰略優勢。這可以通過內部學習和發展計劃實行，或請專門從事 ESG 工作的顧問或第三方協助。隨著混合和虛擬工作模式更趨成熟，採取虛擬 ESG 培訓計劃有幾個優點，例如，比較容易遙距求助於有 ESG 專業知識的專家。培訓計劃也可以因應特定的個人或團體需求量身訂製。比方說，從事貿易融資工作的人需要了解 ESG 對客戶供應鏈風險的影響。
The objective is not to upskill the workforce to the level of becoming environmental scientists, but equip them with the necessary knowledge and insights that encompass the different elements of ESG. To achieve an effective outcome, financial institutions should seek ways to upskill or reskill existing talent working across different areas of the organisation rather than upskilling staff from the usual go-to ESG and sustainability “default” departments. The ultimate aim is to ensure that no member of the workforce is left behind.
這樣做的目的不是把員工技能提升到成為環境科學家的水平，而是為他們提供涵蓋不同 ESG 範疇的必需知識和理念。為取得有效成果，金融機構應設法提高或再培訓內部不同部門的現有人才，而不是只提升專責 ESG 和可持續發展部門員工的技能，最終目標是確保不遺漏任何工作人員。
With a common qualifications benchmark of ESG knowledge ingrained across systems and frameworks, financial institutions can avoid the potential pain-point of having a fragmented strategy to managing ESG and sustainability across their organisation. It should be noted, however, that a common baseline of knowledge also needs to be aligned to the ESG needs and expectations of clients. Bridging the ESG talent gap will not happen overnight, but aligning a strong workforce narrative and understanding the needs of clients is one way of turning a steep learning curve into a competitive edge.
把 ESG 知識的共同評定基準深植於不同系統和架構，金融機構可以避免在整個機構採用分散的策略來管理 ESG 和可持續性的潛在困難。然而應該指出的是，共同的知識基線也需要與客戶的 ESG 需求和期望保持一致。彌補 ESG 人才缺口不會一蹴而就，但協調強大的員工隊伍並了解客戶的需求，是把急就章式學習轉變為競爭優勢的一種方法。
With ESG likely to remain one of the most significant three letter acronyms in the world of banking and finance for the foreseeable future, the Fintech sector is ideally positioned to help Hong Kong banks and financial institutions with their ESG and sustainable finance ambitions.
在可見的未來，ESG 可能仍然是銀行和金融界最重要的縮略三字詞，金融科技業正處於有利位置，可以幫助香港銀行和金融機構實現其 ESG 和可持續融資的遠大目標。