Highlights of the Symposium on Risk Management and Business Intelligence 2023: Global Climate and Environmental Risk Management: Challenges and Opportunities

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Highlights of the Symposium on Risk Management and Business Intelligence 2023: Global Climate and Environmental Risk Management: Challenges and Opportunities

The Symposium of Risk Management and Business Intelligence 2023 was held on Saturday 25 March 2023. The annual Symposium serves as a platform for industry professionals to exchange pioneering ideas and allows students to gain valuable insights and the latest trends in risk management and business intelligence. This year, the theme of the Symposium is “Global Climate and Environmental Risk Management: Challenges and Opportunities”.

In recent years, we have witnessed increasing concerns about climate change and environmental protection. Our challenges are urgent, huge and complex. To this end, Hong Kong as a financial hub must take on a pivotal role to initiate transformational change. This symposium aims to explore both the challenges and opportunities in related areas.

At the start of the event, Professor Kar Yan TAM, Dean and Chair Professor of the School of Business and Management and Professor Ki Ling CHEUNG, RMBI Program Director both gave opening remarks. Professor TAM stressed the importance of risk management under the rapid climate change. Professor CHEUNG pointed out how organizations in Hong Kong must tune our financial role to cope with the aggravated challenges in all aspects resulting from climate change.

The first speaker of the day was Mr. C. F. WONG, Commissioner for Climate Change in the Environment and Ecology Bureau of HKSAR Government. Mr. WONG spoke on the topic of “Striving towards Carbon Neutrality: An Unprecedented Challenge that Brings New Opportunities”. Mr. WONG started by highlighting the challenges and opportunities faced by the business sector in Hong Kong due to climate change. Then, he introduced the Climate Action Plan 2050 published in October 2021 with four major decarbonization strategies, which are net-zero generation, energy saving and green buildings, green transport and waste reduction. Lastly, he also cited examples of waste-to-energy facilities and enhancement of the existing developments that can help strive towards carbon neutrality.

The second speaker was Dr. Cho-Hoi HUI, Head of the Banking Policy Division of the Hong Kong Monetary Authority. Dr. HUI spoke on the topic of “Do Banks Need to Manage Climate-Related Financial Risk? And How?”. Dr. HUI started by introducing the global response to climate change, especially the actions that China and Hong Kong have taken in view of the Paris Agreement. Dr. HUI has also highlighted some of the potential losses arising from climate risks, like higher mean loss and higher variance of losses. Then, Dr. HUI stated the measure issued by the HKMA to support the green finance and banks’ climate risk management, including the three-phased approach for green and sustainable banking, supervisory guidance on climate risk management, physical risk assessment platform for real estate, physical risk assessment platform and so on.

The third speaker was Mr. Ken CHIU, Head of Carbon and ESG Products at Hong Kong Exchanges and Clearing Limited. Mr. CHIU spoke on the topic of “Accelerating the Net-Zero Transition: Recent Developments and Opportunities Emerging in Carbon Markets”. Mr. CHIU started by emphasizing the importance of carbon markets by introducing three recent business cases related to the companies Shell, KMB and the ESG investments. Then, Mr. CHIU had a brief walkthrough on the carbon journey, the HKEX’s and ESG initiatives. Then, he introduced the practical net-zero guide for the business sector issued by the HKEX in December 2021. Lastly, he had also introduced the Core Climate, a carbon marketplace that connects climate-related products and opportunities in Hong Kong, mainland China, Asia and beyond which aimed at contributing to the realization of the global carbon neutrality goal.

The fourth speaker was Ms. Sammie LEUNG, Partner of the Regional ESG Services at PwC Asia Pacific. Ms. LEUNG spoke on the topic of “Integrating Climate Factors into Key Business Decisions”. Ms. LEUNG started by pointing out some of the current ESG initiatives and frameworks to illustrate that it is vital for the stakeholders to understand how climate-related risks and opportunities are likely to impact an entity’s financials in order to make more informed business decisions. Afterwards, she introduced the methodologies of the transition risk in practices by taking an example of the potential financial impact of carbon pricing risk in ABC bank as an organization by 2030 in a net-zero scenario. Lastly, she illustrated a journey in climate scenario analysis of Standard Chartered and some of the ESG-related measures PwC has adopted like the 2030 Net Zero Commitment, ESG digital assets and the corporation with different parties in the ESG ecosystems.

The fifth speaker was Mr. Eimund LOO, Partner of Digital Advisory Services at ERM. Mr. LOO spoke on the topic of “Operationalizing Sustainability through Technology”. Mr. LOO started by highlighting how operationalizing sustainability can be driven by data and processes. He cited the process of how the ESG-related data is diverse and scattered across the value chain, from the resources extraction, processing/suppliers, inbound logistics, operations, outbound logistics, product use and end of life. Then, he introduced the ESG Data Management for the maturity model, unified approach, key functionality considerations, typical process design, example on GRI and GRESB and some of the recommendations like standardizing data collection, automating data & proxies and designing smart analysis.

The final speaker was Dr. Agnes K. Y. TAI, Director of Great Glory Investment Corporation. Dr. TAI spoke on the topic of “Institutional Investors’ Responses to Climate Risks in Companies”. Dr. TAI started by introducing the carbon risk, the scope 1, 2 and 3 emissions and the climate-related financial impact on the business sector. Afterwards, she suggested some ways investors can do to integrate the ESG/Carbon risk into investment decisions like the proprietary investment models. Lastly, she introduced her analysis results and findings in her Ph.D. dissertation in 2022 titled “Does carbon risk matter for Hong Kong equity prices?”.

For the final session, Professor CHEUNG delivered some final remarks to conclude the Symposium and thanked the speakers for bringing new perspectives, thoughts and inspirations to the event and audience members. Overall, the 14th RMBI Symposium 2023 had been a success and a valuable learning experience.

NG Wing Sea, OttoYear 4 in Risk Management and Business Intelligence (Class of 2023)