How Hong Kong's HKEX ESG Reporting Framework Scores Vehicle Emissions A Line-by-Line Explanation for Listed Companies

Under the HKEX ESG Reporting Framework, vehicle emissions are not a footnote. They are counted as quantified, mandatory greenhouse gas data that flows directly into your Scope 1 and Scope 2 disclosures, and, for larger issuers, your Scope 3 reporting as well. For any Hong Kong listed company operating a vehicle fleet, ignoring how those emissions are measured, classified, and disclosed is no longer a compliance option. This article walks through the framework line by line, explaining exactly where vehicles appear, how emissions are calculated, and what actions materially reduce your reported figures.

TL;DR

• HKEX mandates Scope 1 and Scope 2 emissions reporting for all listed companies, with Scope 3 increasingly required under newer climate disclosure rules aligned to IFRS S2 [2][4].

• Fuel combustion from company-owned or company-controlled vehicles is a Scope 1 emission source and must be reported using the GHG Protocol as the measurement standard [3].

• Fleet electrification directly reduces Scope 1 figures and, depending on the electricity source, can substantially lower total reported GHG intensity.

• HKEX has tightened disclosure rules progressively since 2020, with climate-related requirements effective from January 2025 adding new layers of mandatory quantitative reporting [5].

• Converting existing fleet vehicles to electric power is a credible, documentable reduction strategy that supports verifiable ESG disclosures.

About the Author: We are a Hong Kong-based electric vehicle conversion specialist and recipient of the TVB ESG Award, working directly with businesses to reduce corporate fleet emissions as part of documented ESG strategies. Our engineering team holds patented EV conversion technology certified for road-legal use in Hong Kong.

What Does the HKEX ESG Framework Actually Require on Emissions?

The HKEX ESG Reporting Framework is the baseline obligation for all Main Board and GEM listed companies in Hong Kong. Emissions reporting sits within the Environmental pillar, and its requirements have grown significantly over the past five years.

The framework requires listed companies to disclose:

• Scope 1 emissions: Direct GHG emissions from sources owned or controlled by the company, including fuel combustion in vehicles [3].

• Scope 2 emissions: Indirect emissions from purchased electricity, which becomes relevant when a company operates electric vehicles charged on the corporate account [3].

• Measurement standard: The GHG Protocol Corporate Accounting and Reporting Standard is the mandated methodology [3].

• Emission intensity: Total emissions expressed against a relevant business metric (e.g. per vehicle, per square metre of floor area, or per unit of revenue).

Since January 2025, an additional layer of climate-related disclosures has been mandatory, drawing directly from IFRS S2 as a baseline. HKEX is among the first stock exchanges globally to embed IFRS S2 at this level [4][5]. This means governance, risk, strategy, and metrics related to climate must all be disclosed, and your fleet emissions feed into the metrics pillar.

Where Do Vehicle Emissions Appear on the Reporting Line?

Building on the framework overview above, the harder practical question is: which line item captures your vehicles, and how do you calculate it correctly?

Emission Scope	Vehicle Scenario	Measurement Input
Scope 1	Company-owned or leased vehicles burning petrol or diesel	Litres of fuel consumed × emission factor (GHG Protocol)
Scope 2	Company-owned electric vehicles charged using purchased electricity	kWh consumed × Hong Kong grid emission factor
Scope 3 (Category 6 or 13)	Employee business travel in personally-owned vehicles, or downstream use of leased assets	Distance-based or spend-based estimation; increasingly mandatory under IFRS S2 alignment [2]

For most corporate fleets in Hong Kong, the Scope 1 figure from petrol vehicles is material and directly controllable. This is the line that fleet electrification addresses most clearly.

"Fleet emissions are one of the few Scope 1 sources a company can eliminate rather than merely offset."

How Is the GHG Protocol Applied to a Vehicle Fleet?

The GHG Protocol, mandated by HKEX as the measurement standard [3], requires companies to convert fuel consumption into CO₂-equivalent (CO₂e) tonnes using published emission factors. Here is a simplified step-by-step guide for the most common fleet scenario:

1. Collect fuel data: Gather total litres of petrol or diesel consumed across all controlled vehicles during the reporting period.

2. Apply emission factors: Use GHG Protocol or IPCC-aligned factors for the relevant fuel type. Petrol combustion produces approximately 2.3 kg CO₂e per litre; diesel approximately 2.7 kg CO₂e per litre. These are general reference figures based on established GHG Protocol methodology.

3. Sum and convert: Multiply total litres by the applicable factor and convert to tonnes (÷ 1,000).

4. Calculate intensity: Divide total Scope 1 vehicle emissions by your chosen intensity denominator (vehicles operated, revenue generated, etc.).

5. Document boundaries: Clearly state which vehicles are included, the operational control boundary applied, and any vehicles excluded with justification.

For electrified vehicles, the same rigour applies to Scope 2. Total kWh charged is multiplied by Hong Kong's published grid emission factor to produce a CO₂e figure. The critical point: the Scope 2 figure from an electric fleet is typically far lower than the equivalent Scope 1 figure from a petrol fleet of the same size, and it improves further as the grid decarbonises over time.

How Have HKEX Requirements Tightened Since 2020?

Stepping back from the calculation mechanics, a separate concern for compliance teams is the trajectory of regulatory change. The rules have moved quickly.

Milestone	Change	Impact on Vehicle Emissions
2020 ESG Guide Revision [1]	Scope 1 and Scope 2 reporting elevated to "comply or explain"	Vehicle fuel emissions required in annual ESG report
2024 Climate Disclosure Rules [4][5]	IFRS S2 embedded as baseline; eight new mandatory disclosure areas added effective January 2025	Climate risk and transition plans must reference fleet decarbonisation strategies
2025-2026 Scope 3 Roadmap [2]	Scope 3 categories increasingly required; Scope 1-3 now critical for IPOs	Employee and supply chain vehicle use enters the reporting boundary

What Does Fleet Electrification Do to Your Reported Numbers?

A related but distinct question from regulatory compliance is: what is the actual numerical impact of converting vehicles? This matters because HKEX now requires companies to disclose not just current emissions but also targets, transition plans, and the strategies behind them [5].

Converting a petrol vehicle to electric power eliminates its Scope 1 contribution entirely. The resulting Scope 2 charge from electricity is typically a fraction of the prior Scope 1 figure. For a company reporting emission intensity per vehicle, the reduction is immediate, documentable in the same reporting period the conversion occurs, and verifiable through utility billing records rather than estimated fuel logs.

Our EV conversions deliver 200-300 km of WLTP range per charge, determined by the battery capacity that can be accommodated within each vehicle's available space and weight allowance. We are moving towards axial flux motors, the newest up-and-coming motor technology currently only found in supercars and ultra-luxury vehicles. Our conversions come with a 5-year, unlimited mileage warranty, which means the emissions reduction is not a one-cycle benefit but a documented, sustained change across multiple reporting periods.

For fleet operators specifically, we offer a full end-to-end conversion service covering vehicle sourcing, conversion, quality control, and aftersales support, allowing businesses to focus on reporting outcomes rather than managing technical processes. Critically, our conversions are the only road-legal electric conversions currently available in Hong Kong, which matters when auditors verify that a stated emissions reduction corresponds to a vehicle actually operating on the road.

Frequently Asked Questions

Are vehicle emissions mandatory to report under HKEX ESG rules?

Yes. Scope 1 emissions, which include direct fuel combustion from company-controlled vehicles, are mandatory for all listed companies under the HKEX ESG Reporting Framework [3].

Which GHG scope covers a company car running on petrol?

Scope 1. Any vehicle owned or operationally controlled by the company that burns fuel directly contributes to Scope 1 under the GHG Protocol methodology mandated by HKEX [3].

Does switching to an electric vehicle eliminate the Scope 1 entry entirely?

Yes, for the fuel combustion component. The vehicle then generates a Scope 2 entry based on the electricity used for charging, but this is typically a significantly lower figure than the equivalent petrol Scope 1 contribution.

When did HKEX make climate-related disclosures mandatory?

New mandatory climate-related disclosure requirements, aligned to IFRS S2, took effect from January 2025 [5]. Under the 2020 ESG Guide revision, Scope 1 and Scope 2 reporting was elevated to a "comply or explain" basis [1], with mandatory reporting for all listed companies taking effect for financial years commencing on or after January 1, 2025.

Does Scope 3 include employee vehicles used for business travel?

Yes. Business travel in employee-owned vehicles falls under Scope 3 Category 6. With HKEX's alignment to IFRS S2 and the tightening of Scope 3 requirements [2], companies should begin tracking this category even if it is not yet strictly mandatory for their issuer tier.

Can a fleet EV conversion be treated as a verifiable emissions reduction?

Yes, provided the conversion is documented, road-legal, and the Scope 1 reduction is reflected in the same reporting boundary period. Utility records for charging provide a more auditable paper trail than estimated fuel consumption figures.

Is it worth converting existing fleet vehicles rather than buying new electric ones?

For many businesses, yes. Converting an existing vehicle avoids the embodied carbon cost of manufacturing a new one, retains the capital value already invested in the existing asset, and can be significantly cheaper than purchasing new where the fleet in question consists of specialised or classic vehicles.

About Refined Motor

We are a Hong Kong-based electric vehicle conversion company with patented, road-legal EV conversion technology. We work with individual vehicle owners and businesses alike, offering end-to-end EV conversion, restoration, and aftersales support. For listed companies seeking to reduce Scope 1 fleet emissions with a documented, verifiable approach, our fleet conversion service provides a straightforward path from a petrol baseline to an electrified fleet, backed by a 5-year unlimited mileage warranty and the only road-legal conversion certification available in Hong Kong. We are a TVB ESG Award recipient and a member of the HKSTP and Cyberport incubation programmes.

If your company's fleet emissions are a material line in your ESG report and you want a practical, auditable reduction strategy, we can help.

Visit Refined Motor to learn more or get in touch.

References

1. HKEx Publish Conclusions on ESG Guide and Listing ... (www.charltonslaw.com)

2. DQS - ESG Reporting Requirements by HKEX (www.dqsglobal.com)

3. Hong Kong (www.slaughterandmay.com)

4. HKEX ESG Reporting Framework - New Climate-related Disclosure Requirements | Asia | Eversheds Sutherland (www.eversheds-sutherland.com)

5. HKEx Publishes Consultation Conclusions on Enhancing Climate-Related Disclosure | Insights | Skadden, Arps, Slate, Meagher & Flom LLP (www.skadden.com)