Sustainability isn’t optional: The growing stakes of corporate climate action

As regulatory pressures mount and talent expectations shift, sustainability is no longer a peripheral concern for organisations – it sits squarely at the heart of corporate strategy. In the latest session of AsiaHRM’s Sustainability in Business Series, Eman Wong, Vice-President of JIG Family Office and Wealth Management Manager at AIA Hong Kong, made a compelling case for why HR professionals are uniquely positioned to drive this transformation from within.

Why sustainability can no longer be ignored

Wong opened by grounding the conversation in the science of climate change, tracing the roots of the challenge back to the greenhouse gas effect and the emissions produced since the Second Industrial Revolution. For HR practitioners unfamiliar with the technical framework, he offered a clear breakdown of the three scopes of greenhouse gas emissions.

Scope 1 covers direct emissions from the organisation’s facilities and vehicles. Scope 2 addresses indirect emissions from purchased electricity and energy. Scope 3 – increasingly the focus of regulators – captures upstream and downstream emissions across the supply chain, including transportation of raw materials and product distribution.

Understanding these distinctions matters, Wong argued, because organisations in many jurisdictions are now required to measure and disclose emissions across all three scopes. In Hong Kong, the Stock Exchange mandates ESG reporting for listed organisations and has expanded climate disclosure requirements to include Scope 3 emissions for larger organisations. Singapore has similarly moved to extend mandatory reporting to larger non-listed organisations by 2027.

The business risks of non-compliance are threefold: financial penalties from regulators, higher costs of capital as green financing becomes increasingly conditional on ESG performance, and reputational damage that can erode trust among customers, investors and employees alike.

Starting with strategy: The materiality analysis

Before any organisation can meaningfully embed sustainability, it must first determine what actually matters to its specific business context. Wong introduced the concept of materiality analysis – borrowed from the accounting world – as the foundational strategic tool.

Different industries face different material risks and opportunities. A food and beverage company faces a very different sustainability landscape from a manufacturing firm or a professional service provider. A robust materiality analysis combines internal research and interviews across departments with a thorough stakeholder assessment – drawing in perspectives from customers, suppliers and the broader community.

The output is a materiality matrix that plots issues along two axes: importance to the business and importance to stakeholders. Organisations should focus their resources on issues that score highly on both dimensions. Failing to do so risks a charge of greenwashing – the practice of addressing low-priority issues superficially while neglecting what is truly material.

Five levers for HR professionals

Wong identified five practical areas through which HR teams can embed sustainability into the fabric of an organisation.

Employer Branding. Sustainability credentials are becoming a deciding factor for jobseekers. Organisations that communicate their ESG commitments authentically – through websites, social media and recruitment materials – gain a competitive edge in attracting values-aligned talent. Wong cited Patagonia’s now-famous “Don’t Buy This Jacket” campaign as a case study in authentic sustainability storytelling. The organisation’s counterintuitive advertisement, which encouraged consumers to think before purchasing, resulted in a 20-30% uplift in sales – demonstrating that genuine alignment between values and action resonates powerfully with audiences.

Training and Development. Awareness alone is insufficient. HR teams should integrate ESG competencies into organisational competency frameworks, enabling employees at every level to understand how sustainability connects to their daily work. Partnering with external ESG consultancies can accelerate capability building across the workforce.

Succession Planning. Long-term corporate sustainability depends on whether the next generation of leadership genuinely embraces ESG values. Wong points to a high-profile succession challenge at New World Development in Hong Kong as an illustration of the complexities involved. Robust succession planning must go beyond financial stewardship to ensure that ESG principles are embedded in leadership culture and passed on through generations.

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Incentive and Reward. Behaviour follows incentives. Compensation and benefits structures – from senior executive packages to entry-level reward schemes – should be designed to encourage and recognise sustainable behaviour. Aligning ESG objectives with individual and team performance metrics sends a clear signal about organisational priorities.

Sustainable Procurement. Given the significance of Scope 3 emissions, how an organisation manages its supply chain directly affects its overall ESG performance. Establishing ESG assessment criteria for suppliers – and holding them to minimum standards – not only reduces supply chain risk but contributes meaningfully to corporate sustainability targets.

The family office dimension

Wong also touched on the role of family offices in accelerating the sustainability journey, particularly for privately held businesses and high-net-worth families. Services spanning next-generation education, risk management, residency and immigration planning, asset allocation, succession planning and family governance all intersect with the broader sustainability agenda. For family-owned enterprises in particular, cascading values and governance structures to the next generation is as critical as any financial legacy.

The talent dividend

Perhaps the most compelling argument Wong offered for HR professionals is the direct link between strong ESG performance and talent outcomes. Research suggests that a significant proportion of candidates weigh an organisation’s sustainability credentials when evaluating employers, with some willing to accept lower compensation to work for purpose-driven organisations. Retention data is equally striking: organisations with robust ESG programmes may see employee retention rates up to 25% higher than those without.

For HR leaders navigating a competitive talent market, sustainability is not simply a compliance exercise – it is a strategic advantage.

The Sustainability in Business Series continues next week with an exploration of a topic that sits at the intersection of people and organisational resilience. Titled Wellbeing as a Sustainability Strategy: Building Cultures Where People Thrive, the next session will move beyond surface-level wellness programmes to examine how organisations can cultivate cultures where employees genuinely feel supported, valued and empowered.

To register, click here.