Interest in environmental, social and governance (ESG) issues has grown in Asia-Pacific, as companies transition to a green economy and enhance their social responsibility credentials. Sustainability-linked derivatives (SLDs) have emerged as one of the tools available to help firms meet their ESG objectives. However, it is necessary for users to understand how these instruments fit into existing regulatory regimes.
This whitepaper analyzes two categories of SLDs in the context of the derivatives regulatory framework in Hong Kong.
Specifically, it considers:
- Whether SLDs would be classified as over-the-counter (OTC) derivatives transactions or another type of regulated product, and how they are regulated; and
- Compliance issues for market participants to consider when executing SLDs.
Documents (1) for Regulatory Framework for Sustainability-Linked Derivatives: Hong Kong Analysis
Latest
ISDA Launches Pre-adherence Period for Notices Hub
ISDA has begun a pre-adherence process for the ISDA Notices Hub, enabling firms to sign up to a free protocol that will allow them to use the new platform when it launches on July 15. Under the ISDA Master Agreement,...
ISDA SIMM EU Regulatory Approval Requirements
ISDA published ISDA SIMM version 2.7+2412 on May 22 – the first recalibration under the new semiannual cycle. The release triggered a new requirement for EU counterparties to apply for regulatory authorization to use the model – a submission that...
Creating Value - IQ June 2025
Ever since its establishment 40 years ago, ISDA has worked to enhance the safety and efficiency of derivatives markets. That has motivated everything we do – from the development of standard documentation and the rollout of new digital solutions to...
Paper on EC’s Sustainability Omnibus Proposal
On June 9, ISDA published a position paper setting out its views on the European Commission’s (EC) Sustainability Omnibus Package. In the paper, ISDA urges European authorities to: Ensure a proportionate, harmonized and symmetrical approach to the use of derivatives...