Horses for courses

As Hong Kong presses on with its vision of becoming a green finance hub, there has been explosive demand not just for talent but also for educational courses on environment, social and governance, the buzzword in sustainable investing.

And while there are several ESG courses on the market, experts advise aspiring green financiers to see which ones suit them best, as one size does not fit all.

Also, stick to the reputed ones which are internationally recognized, they warn.

Clean energy jobs now outnumber fossil-fuel ones according to the International Energy Agency, which also estimates that to reach net-zero emissions by 2050, the world will need 14 million new clean energy jobs by 2030.

The vast majority of green entrepreneurial activity is happening outside of roles traditionally considered as green and the fastest growing sectors are within software, architecture design and finance, says KDR Recruitment, adding that the ESG market within the financial sector is "growing at a phenomenal rate."

EY aims to triple its ESG team in China in three years while Deloitte China now has a talent training program in place and was expected to double its ESG team to nearly 100 employees by the end of last year.

And in Hong Kong, New World Development (0017) has been hiring ESG strategists at more than HK$100,000 a month since 2021.

KEY ROLE

Human resources veteran and scholar Felix Yip Wai-kwong believes ESG experts are vital for enterprises to succeed in today's world.

"ESG can affect a company's reputation and profit and wrong decisions and mismanagement in ESG operations can even lead to bankruptcy," says Yip, an associate director at the Centre for Human Resources Strategy and Development, School of Business, Hong Kong Baptist University.

As an example, he cites the Deepwater Horizon oil spill of 2010 which was caused by bad management and resulted in BP paying a fine of over US$20 billion (HK$156 billion).

Meanwhile, Hong Kong continues to suffer from a talent shortage in green finance amid a brain drain, while many finance workers in the city lack ESG expertise.

A survey by the Hong Kong Institution of Bankers last year showed that 85 percent of 900 respondents were short on green and sustainable finance skills.

"There's fierce competition for ESG talent," says Alaya Consulting founder Andy Huang You-jei. "When the company was founded eight years ago, it was easier to recruit staff, but in recent years, with the rise of green investment, there is a scramble for talent everywhere."

CHOICE OF COURSES

Meanwhile, there are several ESG courses and certificates now on the market for those who want to get ahead of the game.

These include the CFA Institute's Certificate in ESG Investing and the Asia Investor Group on Climate Change's Climate Change Training for Investors, as listed on the Hong Kong Monetary Authority's website.

Certificates from the US-based CFA Institute and the European Federation of Financial Analysts Societies or EFFAS have the highest level of acceptance within the industry, says Anthony Cheung Chun-yue, vice president of Friends of the Earth, a non-government organization.

Cheung says the CFA certificate is best suited for relationship managers at private banks who market various fund products to their clients.

The CFA certificate has been available in Hong Kong since late 2021 and the city ranked in the top three globally and first in the Asia Pacific region for the cumulative number of registrants for the certificate.

With over 1,300 registrations from September 2021 to August 2022, Hong Kong was third in the world, after the UK and US.

Firms in Europe mostly accept the Certified ESG Analyst or CESGA from the EFFAS, yet, some corporate financial analysts in Asia also take this exam to boost their ESG credentials.

Friends of the Earth says the CESGA is for those who want to acquire and build up essential ESG knowledge or for those who want to become ESG analysts.

Besides, the CESGA is internationally recognized in Europe, Asia, the US and Latin America, it says.

The Asia Pacific region is one of the fastest-growing CESGA exam registrations, accounting for 8 percent of certified professionals.

HOME-GROWN OFFERINGS

Hong Kong's government has a three-year Pilot Green and Sustainable Finance Capacity Building Support Scheme to encourage local practitioners to participate in training related to green and sustainable finance.

After completing the programs, applicants can apply for a subsidy of up to 80 percent of the relevant fees. Full-time student applicants can apply for a subsidy of up to 100 percent of the fees, subject to a ceiling of HK$10,000.

While courses listed by the HKMA are recognized internationally, some others are not.

The Certificate ESG Foundation Course provided by Matters Academic is an introductory-level course on sustainability and the applications of ESG.

The course aims to let participants understand the current trend of ESG fundamentally in the short term but it has not been recognized by any authorities as yet.

Meanwhile, online courses that are registered with the Sustainable Development Goals Knowledge Platform of the United Nations include the Certified ESG Planner offered by the International Chamber of Sustainable Development or ICSD.

Participants are eligible to use the title of CEP once they complete the program and become an ICSD member for HK$800 a year.

The programs include the Executive Certificate in ESG Planning by the Hong Kong Management Association, the Executive Certificate in ESG Investment by Lingnan University Life, and Sustainable Banking and Finance by the Chinese University of Hong Kong.

The first is taught online in Cantonese, the second offers online and face-to-face courses also in Cantonese, and the third is offered in English, online and offline.

NEED FOR STANDARDS

ISCD chairman Angus Yip Wing-hang, meanwhile, warns people to be wary of courses on the market that are not internationally recognized.

"Some beginners are a bit too trusting and register for these courses but if they knew a bit about ESG exams, they would realize there are many differences between the content of these courses and the exams," Yip says.

"They are a waste of time and money."

With so many private institutions and companies competing to offer training programs, Cheung says the market curriculum is unclear and he fears that youngsters are not being taught accurate content.

If they simply finish the courses and take on jobs in ESG or green finance without being properly educated, there will be greenwashing risks, he says.

Besides, some industry experts admit that Hong Kong's ESG ecosystem is not yet mature, and they fear the industry will suffer in the future if youngsters take courses that are short on quality.

While the certificates and courses on the HKMA's list are credible, they only relate to green finance.

Stan Ho Ho-ming, a visiting professor of the executive MBA program at the City University of Hong Kong, says many students are in a dilemma when signing up for courses, as some of them are not very helpful for students or financial practitioners to get international certificates.

He says students should think carefully about the career they want to pursue and also check out the credentials and qualifications of the instructors before signing up for any ESG course.

Yip says the difference in quality among ESG programs in Hong Kong is mainly due to a lack of clear standards for ESG qualifications in the city.

He believes that if Hong Kong can establish a comprehensive ESG system, there will be more students from the Asia-Pacific region registering for programs in the city, and this will enhance its reputation as a green finance and ESG destination of choice.