Your Chinese buyer has sent you a due diligence questionnaire. Here is what the law requires of them — and what they need from you.
China's three major stock exchanges — the Shanghai Stock Exchange (SSE), Shenzhen Stock Exchange (SZSE), and Beijing Stock Exchange (BSE) — have introduced mandatory sustainability reporting requirements for large listed companies. The first mandatory reports, covering fiscal year 2025, are due by 30 April 2026. To produce those reports, Chinese buyers must gather ESG data from their supply chains — including from foreign suppliers. If you supply goods or services to a Chinese listed company, their questionnaire to you is part of their regulatory compliance process.
Key regulations in China — ESG Supplier Guide
SSE & SZSE Mandatory Sustainability Reporting Guidelines
The Shanghai Stock Exchange (SSE) and Shenzhen Stock Exchange (SZSE) issued mandatory sustainability reporting guidelines in April 2024. Companies in the SSE 180 Index, STAR 50 Index, SZSE 100 Index, and ChiNext Index — approximately 457 listed companies — must publish sustainability reports covering governance, environmental impact, social policies, and risk management. The guidelines align with the International Sustainability Standards Board (ISSB) framework and require disclosure across four pillars: governance, strategy, risk and opportunity management, and metrics and targets.
Corporate Sustainability Disclosure Standards — Basic Standards (Trial)
China's Ministry of Finance, together with eight other government authorities, released the foundational Corporate Sustainability Disclosure Standards in December 2024. These establish the national framework for all corporate sustainability reporting, aligned with ISSB and incorporating double materiality — requiring companies to assess both the financial impact of ESG factors on their business and their business's impact on the environment and society. An Application Guide was released in September 2025. These standards are currently voluntary for most companies but form the basis for the mandatory rollout.
Climate Standard No. 1 — Corporate Sustainability Disclosure Standards for Business Enterprises
China's first national climate disclosure standard, released by the Ministry of Finance in December 2025. Aligned with IFRS S2 Climate-related Disclosures. Covers four pillars: governance (board oversight of climate risks), strategy (climate scenario analysis and transition planning), risk and opportunity management (identification and response processes), and metrics and targets (Scope 1, 2, and 3 emissions, carbon reduction targets). Currently on a voluntary trial basis, with mandatory application planned for listed companies and large enterprises from 2027.
National Carbon Emissions Trading System (ETS) — Expanded Coverage
China's National ETS was expanded in March 2025 to cover steel, cement, and aluminium, adding approximately 1,500 enterprises and raising total ETS coverage to around 60% of China's total emissions. Companies in these sectors must submit monthly verified emissions data and complete annual quota settlements. Buyers in these sectors will ask their suppliers for verified carbon data to support their own ETS compliance and sustainability reporting obligations.
HKEX ESG Reporting Requirements (Hong Kong)
Hong Kong-listed companies are subject to separate ESG reporting requirements under the Hong Kong Exchanges and Clearing (HKEX) ESG Reporting Code. HKEX requirements are aligned with IFRS S1 and S2 and include mandatory climate-related disclosures. Hong Kong serves as a key gateway for international companies supplying Chinese buyers, and HKEX-listed companies are among the most active in issuing supply chain ESG questionnaires to foreign suppliers.
What this means for you as a supplier
You are not directly regulated by Chinese ESG law. But your Chinese buyer is. The SSE and SZSE guidelines require covered companies to collect ESG data from their supply chains — including Scope 3 emissions data, which by definition comes from suppliers. A non-response or a weak response creates a gap in your buyer's mandatory sustainability report, which must be filed with the stock exchange by 30 April 2026. Your compliance evidence is part of their regulatory submission.
Key dates
April 2024
SSE, SZSE, and BSE issue sustainability reporting guidelines — mandatory scope defined
December 2024
Ministry of Finance releases Corporate Sustainability Disclosure Standards — Basic Standards (Trial)
March 2025
National ETS expanded to steel, cement, and aluminium — 1,500 additional enterprises covered
September 2025
Application Guide for Basic Standards released — detailed implementation instructions
19 December 2025
Climate Standard No. 1 released — China's first national climate disclosure framework, ISSB-aligned
30 April 2026
First mandatory sustainability reports due — SSE 180, STAR 50, SZSE 100, and ChiNext Index companies
2027
Mandatory application of Climate Standard No. 1 planned for listed companies and large enterprises
2030
Unified national sustainability disclosure system — comprehensive mandatory coverage across all sectors
Which Chinese companies must report
Mandatory sustainability reporting currently applies to companies listed on the SSE 180 Index, STAR 50 Index, SZSE 100 Index, and ChiNext Index — approximately 457 companies. These are among China's largest and most internationally active listed companies. They include major manufacturers, technology firms, financial institutions, and state-owned enterprises with extensive global supply chains.
As a foreign supplier, you are not directly regulated by Chinese ESG law. But the companies buying from you are. The mandatory reporting framework explicitly requires covered companies to collect ESG data from their supply chains to support their own disclosures — including Scope 3 emissions, which originate with suppliers. Your questionnaire is the mechanism through which they gather that data.
What your Chinese buyer's questionnaire will ask
Chinese buyer questionnaires follow the four-pillar structure of the SSE/SZSE guidelines and the Ministry of Finance's Basic Standards. The areas below reflect what is commonly requested from foreign suppliers. The more structured evidence you can provide, the lower the compliance gap your buyer faces in their mandatory report.
If your buyer is in steel, cement, or aluminium
The March 2025 expansion of China's National ETS to steel, cement, and aluminium creates specific, heightened data requirements for suppliers in these value chains. Companies in these sectors must submit monthly verified emissions data and complete annual quota settlements with the national carbon market. They will require verified Scope 3 data from their suppliers — including purchased goods and services — to support their own ETS compliance. If your buyer is in one of these sectors, expect more detailed and more frequent carbon data requests than from buyers in other sectors.
If your buyer is listed in Hong Kong (HKEX)
Hong Kong-listed companies operate under a separate ESG framework administered by HKEX. HKEX requirements are aligned with IFRS S1 and S2 and include mandatory climate-related disclosures from 2025. Hong Kong serves as the primary international gateway for Chinese companies accessing global capital markets, and HKEX-listed companies are among the most sophisticated ESG reporters in the region. Their questionnaires to foreign suppliers tend to be more detailed and more closely aligned with international standards (TCFD, GRI, ISSB) than those from mainland-listed companies. If your buyer is HKEX-listed, expect questionnaires that closely resemble those from European or UK buyers.
If you already report under EU or UK frameworks
China's Basic Standards and Climate Standard No. 1 are explicitly aligned with the ISSB framework (IFRS S1 and S2). If your business already produces disclosures under CSRD, TCFD, or GRI, significant overlap exists. The table below shows where Chinese requirements map to frameworks you may already be using.
| Chinese requirement | EU/UK equivalent | Notes |
|---|---|---|
| Climate governance (4 pillars) | TCFD / IFRS S2 / CSRD ESRS E1 | Near-identical structure |
| Scope 1, 2, 3 emissions | GHG Protocol / CSRD ESRS E1 | Same methodology; Chinese buyers accept GHG Protocol data |
| Double materiality | CSRD double materiality | China's version is more flexible in methodology |
| Labour practices | CSRD ESRS S1 / UK Modern Slavery Act | Broadly equivalent; Chinese version adds rural development context |
| Anti-corruption governance | CSRD ESRS G1 / UK Bribery Act | Equivalent in substance |
| Dual carbon alignment | No direct equivalent | China-specific; reference your own net zero or SBTi commitment if applicable |
Enforcement and consequences of non-response
Chinese ESG enforcement is primarily stock exchange-driven rather than government penalty-based at this stage. Listed companies that fail to publish sustainability reports face regulatory scrutiny from the SSE, SZSE, or HKEX, and potential reputational consequences with institutional investors. The practical consequence for foreign suppliers is commercial rather than legal: a buyer who cannot complete their mandatory sustainability report due to supplier data gaps may deprioritise or remove non-responsive suppliers from their approved vendor list.
| Exchange | Mandatory scope | Enforcement mechanism |
|---|---|---|
| SSE (Shanghai) | SSE 180 Index + STAR 50 Index + dual-listed groups | Exchange regulatory review; investor scrutiny; mandatory public disclosure |
| SZSE (Shenzhen) | SZSE 100 Index + ChiNext Index | Exchange regulatory review; investor scrutiny; mandatory public disclosure |
| HKEX (Hong Kong) | All listed issuers (climate mandatory from 2025) | HKEX listing rules; SFC oversight; international investor expectations |
| BSE (Beijing) | Voluntary encouragement | No mandatory enforcement; government expectation of adoption |
What is coming next
China's roadmap is explicit. By 2027, Climate Standard No. 1 is expected to become mandatory for listed companies and large enterprises. By 2030, a unified national sustainability disclosure system covering all sectors — including non-listed companies and SMEs — is planned. The pipeline mirrors the EU's phased CSRD rollout: start with large listed companies, expand to smaller entities over time. Foreign suppliers who build their ESG response capability now will be ahead of the wave when mandatory coverage reaches their Chinese buyers' full supply chains.
Last reviewed: April 2026. This guide is for general information only and does not constitute legal advice. Regulations change — verify current requirements with a qualified adviser.
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