Hong Kong businesses, specially small and medium-sized ones, are set to receive a boost to enhance their environmental, social and governance practices with the launch of a new AI tool to help them comply with rules.

Green360 was launched by The Hong Kong General Chamber of Commerce (HKGCC) on Friday, and it is an online learning platform aimed at helping small and medium-sized enterprises (SMEs) to start and develop their environmental, social and governance (ESG) audit and reporting processes.

Speaking at a launch ceremony, Algernon Yau, Secretary for Commerce and Economic Development, said the platform represents a pivotal step in Hong Kong's push forward as part of its sustainability agenda.

"The introduction of Green360 comes at a crucial time as we navigate the complexities of environmental challenges for sustainable practices that are urgently needed. This innovative platform not only aligns with the global movement towards a greener economy but also emphasizes Hong Kong's role as a leader in integrating advanced technology commercial development," Yau said.

Since January 25, all companies are required by the Hong Kong Exchanges and Clearing to disclose their direct and indirect greenhouse gas emissions.

The move also came as the government rolled out a road map in December to align its sustainability disclosure requirements with International Financial Reporting Standards – Sustainability Disclosure (ISSB) Standards by 2028.

Echoing Yau, HKGCC chairwoman Agnes Chan noted that the tool, which is empowered by artificial intelligence technology, will help speed up the city's green transition.

"AI is emerging as a crucial driver for integrating green and just transitions, digital platforms and data analytics pivotal in accelerating the de-carbonisation of both the economy and the capital markets," she said.

"Many companies are uncertain about where to begin or lack the resources to pursue such initiatives. So Green360 alleviates these concerns by helping them to identify areas for improvement and achieve accreditation without incurring significant costs," she added.

Fillippo Addarri, senior advisor for the United Nations Development Programme and project lead for the European Union Social Impact Score, said at the same event that Hong Kong and the European members could cooperate over green finance following increased economic ties between Europe and China.

He said that Chinese green investments in Europe, such as in the battery and electric vehicle fields, have seen a 50 percent increase year on year.

"And as a global financial hub, Hong Kong is poised to become a key partner of the European Union. Your advanced regulatory framework and culture of innovation sets your leadership in the driving seat," he said.

Touching on the question of support from Beijing, Xin Bingxian, executive secretary of the World Development Foundation, said at the event that the move is in line with the direction signalled from the Two Sessions meetings this year that carbon reduction requirements are shifting from voluntary to mandatory.

But she suggested the SAR government cooperate with mainland authorities to also align on ESG disclosure rules as there are notable differences in regulations.