Companies across the Asia-Pacific region are leaning into the transition to a cleaner, more resilient global economy, though planning has outpaced follow-through.
Nearly three-quarters (74%) of companies surveyed across the Greater Bay Area (GBA) and Southeast Asia (SEA) have established board and management responsibilities for the climate transition, but only 12% in each region have translated those responsibilities into financial mechanisms such as remuneration, internal carbon prices and capital spending, according to an analysis by the MSCI Institute, the Bank of China’s Hong Kong Financial Research Institute and the Jockey Club Enterprise Sustainability Global Research Institute at Hong Kong University.[1]
Released ahead of Hong Kong Green Week, the report draws on a survey of 117 organizations, with respondents from the GBA and SEA making up 86% of the sample. Eighty-four percent of organizations surveyed consider sustainability to be of high or very high importance to their strategy and operations over the next three years, roughly unchanged from a year earlier.[2] Nearly 80% say they plan to increase sustainability-related spending over the next five years, up from 70% a year ago.
The findings show that the GBA and SEA economies differ in their industrial strengths, exposure to climate risk and financing needs. They also show that companies, banks and investors in both regions are navigating how to address a changing physical climate and the energy transition, as well as the role of capital in that effort.
Transition planning has outpaced financial follow-through
Companies surveyed in the GBA lead their SEA counterparts on identifying transition and physical risks, while the two regions are evenly matched on having a climate-risk management process. Companies in SEA lead on integrating climate risk into enterprise risk management and on the financial mechanisms shown, including linking executive pay to climate, disclosing climate-related capital expenditure and using internal carbon prices. Nonetheless, the operationalization gap in both regions points to demand for transition expertise and transition financing.
Progress across three key pillars
Source: MSCI Sustainability & Climate, Data as of July 31, 2026. Data covers 263 publicly listed companies in the Greater Bay Area (based on relevant regional constituents of the MSCI China IMI and MSCI Hong Kong IMI indexes), and 343 companies in Southeast Asia (based on constituents of the MSCI Indonesia, Malaysia, Philippines, Singapore and Thailand IMI indexes).
Transition revenues and technology readiness shape financing playbooks and regional cooperation
Transition-solutions revenue among companies surveyed in the GBA and SEA are concentrated in clean transport, particularly vehicles. Median revenue exposure to clean-transport vehicles is 8.9% in the GBA and 3.6% in SEA. Companies surveyed in the GBA also show relatively high exposure to wind (5.9%), alternative energy sources (4.3%) and energy-efficiency and flexibility solutions (2.9%). In SEA, wind is the second-largest source of revenue from transition solutions, with median exposure of 1.8%, followed by solar at 1.5%. Companies in both regions can increasingly acquire transition technologies such as onshore wind and solar at prices competitive with carbon-intensive alternatives. Investors and lenders may therefore be able to incorporate sustainability indicators or covenants into loan agreements with companies that use clean technologies.
Transition solutions revenue by category
Source: MSCI Sustainability & Climate, based on data as of July 31, 2026. Exposure and scores are derived from MSCI’s Energy Transition Score, which provides a forward-looking assessment of how well a company is positioned for the transition over the next five to seven years, relative to business and regulatory transition pressures. The data covers a subset of companies with transition-solutions revenue, including 79 publicly listed companies in the Greater Bay Area, based on relevant regional constituents of the MSCI China IMI and MSCI Hong Kong IMI indexes, and 126 companies in Southeast Asia, based on constituents of the MSCI Indonesia, Malaysia, Philippines, Singapore and Thailand IMI indexes.
Physical risk and resilience are emerging as the market’s next financing frontier
Facing unique but mounting physical risks, companies surveyed in both regions express a need for financing that enables them to strengthen their ability to adapt to and withstand physical climate risk. Companies in the GBA are more likely than their SEA counterparts to hold patents for adaptation solutions (14.1% versus 3.2%) and to have adaptation-related revenues (14.4% versus 9.3%).
Adaptation-related revenue and patents among issuers
Source: MSCI Sustainability & Climate, based on data as of July 31, 2026. The data covers 263 publicly listed companies in the Greater Bay Area, based on relevant regional constituents of the MSCI China IMI and MSCI Hong Kong IMI indexes, and 343 publicly listed companies in Southeast Asia, based on constituents of the MSCI Indonesia, Malaysia, Philippines, Singapore and Thailand IMI indexes.
A focus on adaptation finance
Issuance of bonds with adaptation-related use of proceeds reached an estimated USD 19 billion in the first half of 2026, reflecting growing borrowing by government issuers and the rising importance of climate resilience.
Nearly USD 33 billion of bonds with adaptation-related use of proceeds were outstanding across the GBA and SEA as of July 31, 2026. In the GBA, USD 20.7 billion was outstanding, with corporate issuers such as MTR, China Southern Power Grid and Swire Properties accounting for the largest share. The Hong Kong SAR Government accounted for most of the remainder. In SEA, USD 12.2 billion was outstanding, concentrated in Indonesia’s agency-based Islamic bond program.
Green bonds by issuer type
Source: MSCI Sustainability & Climate, based on data from FactSet. Data as of July 31, 2026.
References
[1] The GBA comprises the two Special Administrative Regions of Hong Kong and Macao, and the nine municipalities of Guangzhou, Shenzhen, Zhuhai, Foshan, Huizhou, Dongguan, Zhongshan, Jiangmen and Zhaoqing in Guangdong Province. SEA comprises Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.
[2] Organizations here refers to all respondents to the survey. Companies refers to corporate respondents or listed companies, depending on the data source. References to issuers include companies, government entities and other bond issuers.
