As sustainable development continues to gain prominence as an international strategy and trend, environmental and social governance (ESG) compliance issues are becoming increasingly important for Chinese companies facing an increasing number of challenges.

Taking disclosure rules as an example, although there are no complete and independent laws, regulations or regulatory documents on ESG disclosure in mainland of China, both the Shanghai and Shenzhen stock exchanges require listed companies to disclose their fulfilment of social responsibility in annual reports, drawing the attention of more Chinese companies to the issue of ESG system building.

As labour compliance is a key component of the “S” in ESG, its importance cannot be overstated.