Management Approach

Materiality Assessment

We conduct our materiality assessment to identify the material topics, as well as to ensure all material business entities relevant to these topics are included in this report.

Our approach


Our Boundary Scoping and Materiality Identification (BSMI) assessment defines the key content of this report.

We developed the BSMI methodology to define the topics that matter to our business and to our key stakeholders, as well as the reporting boundaries of these topics.

The objectives of BSMI is to not only meet external reporting (e.g. GRI Standards, HKEx ESG Guide) and internal requirements (e.g. Internal Control, CLP Value Framework), but also to help drive CLP’s sustainability performance in response to changing internal and external stakeholders expectations.

The development of the BSMI is a journey in itself. Since we first developed it in 2013, it has matured through the following milestones:

  • 2013 - developed to prepare for the transition of our reporting from using the GRI G3.1 to G4 Guidelines
  • 2014 - fully rolled out as we reported in accordance with the G4 Guidelines
  • 2015 - improved the prioritisation of the most material topics
  • 2016 - adopted the topics from the new GRI Standards and engaged Senior Management for validation

The BSMI results are validated by our Senior Management in line with the Group’s strategic priorities as part of the governance process. The effectiveness of our approach to determining materiality for this report is tested by: annual internal controls testing of the BSMI process; internal audit of our Sustainability Reporting process every three years; and annual external independent assurance of a portion of our most material Environmental, Social and Governance (ESG) data.

Materiality Identification

The Materiality Identification part identifies the sustainability topics that are important to CLP and to our key external stakeholders. Our approach relies on internal assessment performed by our internal subject matter experts who draw on feedback from regular engagements with their key stakeholders during their daily operations, to help deliver more relevant and appropriate results. This approach helps integrate our operational, business strategy and reporting objectives, as well as minimise what some of our stakeholders refer to as “engagement fatigue”. A topic is considered material if it is material to either our business or our stakeholders.


The following factors were considered during assessment:

  • Materiality of risk – whether the topics could result in material consequences on our business or our external stakeholders are likely to happen;  
  • Business efficiency – whether the topics affect the efficiency of our systems and processes from strategy formulation to day-to-day operations, which could in turn affect our customers, investors and the environment for example; and 
  • License to operate – whether the topics have substantial impacts on our ability to obtain and maintain legal and social licences to operate.

Boundary Scoping

The Boundary Scoping part defines the reporting boundaries of the sustainability topics to ensure the scope of relevant material business entities included is complete. Different topics may have different reporting boundaries as what business entities or activities are most material for one topic can differ from another. We believe that the discipline of applying subject matter-related expertise and criteria to determine the reporting boundary by topic or metric, helps to strengthen our capability to monitor and manage potential emerging ESG risks, particularly when there is a change in our investment portfolio.