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Hong Kong and China Gas Company (Towngas) has launched a new scheme with HSBC to improve efficiency and reduce supply chain emissions to help the city reach carbon neutrality by 2050.
Hong Kong's sole piped-gas provider will extend advance payments to suppliers with a lower interest rate through its tie-up with the city's largest lender, provided they can meet the company's environmental, social, and governance (ESG) standards, according to the company.
"By linking sustainability performance to payment services, we hope to take on a larger role in further encouraging suppliers to improve their ESG management standards and jointly promote the sustainable transformation of the industry chain," said Felix Lee, the head of ESG and corporate affairs at Towngas.
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The scheme primarily targets the company's suppliers for sales and installation of stove products, representing 20 per cent to 30 per cent of suppliers' gas purchases.
The programme allows companies with better ESG performance to receive more favourable discounts on the interest rate, Towngas said. However, the company did not provide further details.
The scheme will also help Towngas to better track and reduce its scope 3 emissions, which are attributed to supply chain partners.
Towngas and HSBC executives witness the signing ceremony for the supply chain finance programme between Raymond Lee (sitting) and Anita Tsang on Thursday. Photo: Towngas alt=Towngas and HSBC executives witness the signing ceremony for the supply chain finance programme between Raymond Lee (sitting) and Anita Tsang on Thursday. Photo: Towngas>
Towngas' new scheme is in line with the Hong Kong stock exchange's regulations on monetary disclosure of listed firms' scope 3 emissions, which comes into force in 2026, Lee said. He expects between five and 10 suppliers to join the Towngas project this year.
It will be mandatory for the largest listed firms to report their scope 3 emissions for the financial year beginning January 1, 2026, according to bourse operator Hong Kong Exchanges and Clearing.
The tightening disclosure requirements around scope 3 mean that small and medium-sized firms will need to make known their emissions if they want to do business with the largest firms listed on the city's stock exchange.