In the transition to a low-carbon economy, we understand the risks associated with a changing climate and have made appropriate provisions for them in our businesses.
These provisions are based on the risks we identified in a comprehensive climate risk assessment in 2015 of our Hong Kong operations under extreme weather events; in 2016, we extended this exercise to our project companies in the Chinese mainland. In 2019, we conducted a gap analysis to better align our climate change management against the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) under Governance, Strategy, Risk Management, and Metrics and Targets.
In 2020, we also assessed our transition risks and opportunities across Towngas’ energy-related businesses in Hong Kong and the Chinese mainland under various climate scenarios. Major transition risks comprise policy changes, reputational impact and shifts in market preferences, including upstream and downstream changes.
In 2021, we initiated another round of physical risk assessments for our critical facilities across the region. Supplemented by computer modelling studies, the assessment identified major physical risks faced by our businesses, such as rising temperatures and sea levels, drought and extreme weather events, all of which could have a significant impact on our operations.
To mitigate physical risk, we incorporate resilience measures at the planning and design stages. Additional measures to protect our existing operations against climate risks include installation of flood gates in our
Infrastructure/gas facilities, as well as enhanced maintenance and inspection programmes. We also visit our project companies’ sites to understand their regional climate-related risks and to help them prepare for adverse weather events. This includes advising them on mitigation and resilience measures, as well as the provision of training in combating climate change.
We have also identified opportunities made possible by new technologies, products and services that could enable us to become more resilient and adaptive to climate change.
We review and update our climate-related risks on at least an annual basis to ensure we are sufficiently resilient against this emerging risk. We will continue to align with the TCFD disclosures, not only to communicate with our stakeholders in a more transparent manner but also to ensure our business grows sustainably.