TRANSCENDENCE
FROM TELCO TO ICT POWERHOUSE
ANNUAL REPORT 2023
TRANSCENDENCE
FROM TELCO TO ICT POWERHOUSE
ANNUAL REPORT 2023
TRANSCENDENCE
FROM TELCO TO ICT POWERHOUSE
From our beginnings as a start-up, HKBN has focussed on meeting the multilayered needs of customers. Our international direct dial (“IDD”) services disrupted the industry and set us on a path of success. Growing from one opportunity to the next, we pushed the boundaries of Internet service by becoming Hong Kong’s first to mass deploy 100Mbps in 2004, and the world’s first to mass deploy 1000Mbps fibre broadband in 2005. These breakthroughs, and others, propelled us to become the largest alternative telecommunications provider in the city.
In an always changing digital world, one of the biggest threats to competitiveness is complacency. Recognising this, we moved early to transcend our core telco strengths, and began expanding and engineering our technology & solutions capabilities in the mode of a one-stop ICT Powerhouse. Today, the synergetic force of our residential and enterprise divisions — from ultra-fast broadband, 5G and cloud computing, to AI, digital transformation and business-critical solutions — plays an essential role in making society a better place for people, businesses and institutions to live, learn, work, play and communicate.
In an always changing digital world, one of the biggest threats to competitiveness is complacency. Recognising this, we moved early to transcend our core telco strengths, and began expanding and engineering our technology & solutions capabilities in the mode of a one-stop ICT Powerhouse. Today, the synergetic force of our residential and enterprise divisions — from ultra-fast broadband, 5G and cloud computing, to AI, digital transformation and business-critical solutions — plays an essential role in making society a better place for people, businesses and institutions to live, learn, work, play and communicate.
Dear fellow HKBN shareholders
As the Telecom industry enters the ex-growth phase, it is essential for us to pivot to an adjacent growth industry which can leverage on our tens of billions of fixed-line Telecom infrastructure investment made over the past 30 years between HKBN, New World Telecom and Wharf T&T, and do it without confining ourselves only to this infrastructure. A natural transcendence would be a move up the value vertical from Telecom to become an information and communication technology (“ICT”) Powerhouse.
William Yeung
NiQ Lai
Revenue
HK$11.7B
Revenue growth
1%
ENTERPRISE
SOLUTIONS
HK$4.83B
Revenue
101,000
Enterprise customers
8,090
Commercial building coverage
Recurring billing relationship with
1 in 2
Hong Kong active companies
RESIDENTIAL
SOLUTIONS
HK$2.39B
Revenue
972,000
Residential customers
over 2.55 m
Residential home passed
Recurring billing relationship with
1 in 3
Hong Kong families
Make our Home a Better Place to Live
We believe all the Purpose in the world means nothing without action. Mindful of this, we make huge efforts in ensuring that Purpose is not just a hollow mission statement, but deeply embedded across our entire operation. In everything we do, and in every decision we take, "Make our Home a Better Place to Live" is omnipresent at all times. With this Core Purpose driving us, HKBN is built on making purposeful profits; our business is at its best when we’re creating positive impacts for our stakeholders.
Mirroring our ongoing commitment to materially do more for sustainability, we have linked executive remuneration to ESG performance, where part of the salaries of our Executive Vice-chairman, our Group CEO, and three senior management are now stipulated with a goal of reducing our electricity consumption by FY24 compared with FY22. This incentivises our leaders to drive aggressive change and be accountable for meeting our ambitious ESG goals.
In FY23, our ESG journey received a number of important recognitions. This year, Morgan Stanley Capital International (MSCI), a global leader in financial and ESG reporting, upgraded our ESG performance to the highest possible AAA rating, placing HKBN among the top 9%1 of telcos worldwide. Hang Seng Corporate Sustainability Index also upgraded our rating from AA to AA+. Together, these outstanding sustainability evaluations reaffirm our progress and position as the top ESG leader in our industry in Hong Kong.
2
- 1 As at the time of receiving the AAA rating
- 2 https://reg.hkbn.net/WwwCMS/upload/pdf/en/2022_disclaimer.pdf
HKBN
ESG
Strategy
Lead as an Innovative ESG Enabler
Talent Co-Ownership
1. Talent interest alignment
2. Talent-obsessed engagement and development
3. Diversity and inclusion
Technology for Good
4. Market-ready ESG solutions
5. Digital inclusion for our communities
Transforming Business
6. Climate action
7. Impactful customer experiences
8. Data privacy and security
9. Reliable and responsible services
10. Win-win-win partnership and value chain
HKBN ESG Strategy
Lead as an Innovative ESG Enabler
Talent Co-Ownership
1. Talent interest alignment
2. Talent-obsessed engagement and development
3. Diversity and inclusion
Technology for Good
4. Market-ready ESG solutions
5. Digital inclusion for our communities
Transforming Business
6. Climate action
7. Impactful customer experiences
8. Data privacy and security
9. Reliable and responsible services
10. Win-win-win partnership and value chain
| The 3Ts of HKBN & Mapping to the SDGs* | Our 10 Priorities | Goals for FY25 | FY23 Progress |
|---|---|---|---|
Talent Co-Ownership
|
Talent interest alignment | Achieve at least 88% cumulative successful rate in ESG-related special incentive programmes | Five senior executives have linked their salaries with a target to reduce our FY24 electricity usage by 14% (relative to FY22) |
| Talent-obsessed engagement & development | Reach an overall engagement score of 70% favourability in our Talent Engagement Survey | Achieved an overall engagement score of 69% “favourable” in our Talent Engagement Survey, a 4% increase from FY22 | |
| Diversity & inclusion | Enhance female representation in technical roles to 27% or above 1 | Achieved 24.7% of female representation in technical roles | |
Technology for Good
|
Market-ready ESG solutions | Launch new ESG-themed solutions every year | Launched our first ESG-related solution for enterprise customers |
| Digital inclusion for our communities | Conduct social impact assessments for all digital inclusion community initiatives | Introduced HKBN’s digital inclusion social impact assessment tool Completed stakeholder research on our digital inclusion social impact assessment, and defined indicators for measuring our impacts |
|
Transforming Business
|
Climate action | Set science-based emissions reduction targets | Established a greenhouse gas (“GHG”) emissions baseline inventory for setting science-based reduction targets |
| Impactful customer experiences | Futureproof HKBN’s customer services by launching new customer experience initiatives every year | Residential Solutions: In the process of developing “Smart Broadband Move”, a My HKBN App self-service tool for customers to schedule relocation of their broadband service Enterprise Solutions: Deployed e-forms for over 70% of general service contracts since 2023 |
|
| Data privacy & security | Achieve less than 2% phishing assessment average failure rate among Talents | 1.38% phishing assessment average failure rate Organised the Cybersecurity Day and educated over 1,000 Talents with cybersecurity knowledge |
|
| Reliable and responsible service | Reduce affected customer hours from residential network service disruptions by 14%, relative to FY22 baseline | Reduce affected customer hours from residential network service disruptions by 4%, relative to FY22 baseline Extended the use of IoT applications in data centres and our central office for pre-emptive maintenance |
|
| Win-win partnership & value chain | Improve at least 20 SME suppliers’ ESG assessment scores | Created a questionnaire to evaluate suppliers’ ESG performance | |
| Corporate Governance | Achieved 33% female representation among the Board of Directors | ||
| The 3Ts of HKBN & Mapping to the SDGs* |
|---|
| Talent Co-Ownership
|
| Our 3 Priorities |
| Talent interest alignment |
| Talent-obsessed engagement & development |
| Diversity & inclusion |
| Goals for FY25 |
| Achieve at least 88% cumulative successful rate in ESG-related special incentive programmes |
| Reach an overall engagement score of 70% favourability in our Talent Engagement Survey |
| Enhance female representation in technical roles to 27% or above 1 |
| FY23 Progress |
| Five senior executives have linked their salaries with a target to reduce our FY24 electricity usage by 14% (relative to FY22) |
| Achieved an overall engagement score of 69% “favourable” in our Talent Engagement Survey, a 4% increase from FY22 |
| Achieved 24.7% of female representation in technical roles |
| Technology for Good
|
| Our 2 Priorities |
| Market-ready ESG solutions |
| Digital inclusion for our communities |
| Goals for FY25 |
| Launch new ESG-themed solutions every year |
| Conduct social impact assessments for all digital inclusion community initiatives |
| FY23 Progress |
| Launched our first ESG-related solution for enterprise customers |
| Introduced HKBN’s digital inclusion social impact assessment tool Completed stakeholder research on our digital inclusion social impact assessment, and defined indicators for measuring our impacts |
| Transforming Business
|
| Our 5 Priorities |
| Climate action |
| Impactful customer experiences |
| Data privacy & security |
| Reliable and responsible service |
| Win-win partnership & value chain |
| Goals for FY25 |
| Set science-based emissions reduction targets |
| Futureproof HKBN’s customer services by launching new customer experience initiatives every year |
| Achieve less than 2% phishing assessment average failure rate among Talents |
| Reduce affected customer hours from residential network service disruptions by 14%, relative to FY22 baseline |
| Improve at least 20 SME suppliers’ ESG assessment scores |
| FY23 Progress |
| Established a greenhouse gas (“GHG”) emissions baseline inventory for setting science-based reduction targets |
| Residential Solutions: In the process of developing “Smart Broadband Move”, a My HKBN App self-service tool for customers to schedule relocation of their broadband service Enterprise Solutions: Deployed e-forms for over 70% of general service contracts since 2023 |
| 1.38% phishing assessment average failure rate Organised the Cybersecurity Day and educated over 1,000 Talents with cybersecurity knowledge |
| Reduce affected customer hours from residential network service disruptions by 4%, relative to FY22 baseline Extended the use of IoT applications in data centres and our central office for pre-emptive maintenance |
| Created a questionnaire to evaluate suppliers’ ESG performance |
| Corporate Governance |
| Achieved 33% female representation among the Board of Directors |
- 1 This target was revised from 18% to 27% due to a refinement of the definition of technical roles.
Talent Co-Ownership
Our Talents are not just employees but fundamental partners in our success. In a world full of change, each Talent brings a unique mix of perspectives, skills, experiences and passions to deliver the best for our customers. We empower our Talent-force with the knowledge, resources and opportunities to grow HKBN’s business and lead the industry in creating a better future.
Talent interest alignment
Our FY23 progress:
- 5 senior executives have linked their salaries with a target to reduce our FY24 electricity usage by 14% (relative to FY22)
- 406 Talents chose to invest their personal savings as Co-Owners of HKBN via our Amended Co-Ownership Plan IV
Talent-obsessed engagement & development
Our FY23 progress:
How we enable LIFE-work priority and Talent health and wellness:
- ISO 45001-certified occupational health and safety system
- Provided HKBN x Mannings free pharmacist consultation services and medication
How we enhance Talent engagement and communication:
- Talent engagement survey
How we develop Talents at different levels:
- 1-HKBN Academy provides structured training programmes, e-learning and best practices
- Be a Pioneer programme cultivates Talents into management roles
- Be a People's Leader programme equips supervisory Talents with leadership skills
- Talent Development Sponsorship Scheme supports all Talents in their learning journeys
- Average 17 hours of training for each Talent
Diversity & inclusion
Our FY23 progress:
24.7% of female representation in technical roles
Established HKBN Women’s Network to support and empower our female Talents
Partnered with Women in Work to organise “Digital SHEROes” programme to provide guidance to 15 female technology entrepreneurs
Technology for Good
We hold a deep love for technology and its transformative potential. From using it to enhance communications, learning, and business processes, to how we improve our environmental footprint, or uplift disadvantaged communities, HKBN is committed to using technology as a force for good and making a meaningful impact on the world around us.
Market-ready ESG solutions
Our FY23 progress:
- Enhanced enterprises with AegisConnect solution to give customer real-time visibility of their network health
- Launched IT · Simplified to help enterprises of all sizes, especially SMBs, overcome the many IT challenges
- Launched Smart Connect: Managed IoT — Energy Monitoring to help enterprises develop the right long-term energy management strategy
Digital inclusion for our communities
Our FY23 progress:
Engaged external consultant to conduct a comprehensive review of our CSI work
Introduced HKBN's digital inclusion social impact assessment tool to evaluate the effectiveness of our upcoming CSI initiatives
Launched HKBN SPO IT Club to make technology and expert knowledge more accessible to social profit organisations
Empowered 80 social profit organisations with our initiatives in FY23
1377.5 hours volunteered for community good
Transforming Business
Making progress starts from transforming HKBN into a better company – not just in a few areas, but in every area. From our environmental impact, data privacy or the way we solve customer complaints, to cybersecurity, customer experiences, and how we deliver fast and reliable services, improving our business and operations ensures that our impacts can go a lot further.
Climate action
Our FY23 progress:
- Electricity consumption reduced by 10.62%
- Applied ISO 14001 environmental management system from the operations of data centre to the operations of site, office, warehouse and workshop
- Established a greenhouse gas emission baseline inventory for setting science-based reduction targets
- Reduced 1.02 tonnes of paper usage via adopting electronic forms and contracts in mainland China
Reliable and responsible services
Our FY23 progress:
>99.99% Core Network availability and Access Network availability for customers*
Launched Hong Kong’s first dual-path subsea cable system, TKO Connect
Extended the use of IoT applications in data centres and our central office for pre-emptive maintenance
Launched dual-link broadband and higher-tier dual-link DIA/PDIA services for enterprises to minimise risk of service disruption
* Not including events or circumstances beyond HKBN’s control.
Impactful customer experiences
Our FY23 progress:
- In the process of developing “Smart Broadband Move”, a My HKBN App self-service tool for residential customers to schedule relocation of their broadband service
- Deployed e-forms for over 70% of general service contracts for enterprises
- Received 3,428 complimentary notes in FY23
- 85% combined answer rate across all our residential service channels
- Over 36,082 hours of products, sales, marketing and quality improvement trainings provided to our Talents
Data privacy & security
Our FY23 progress:
Organised Cybersecurity Day to empower over 1,000 Talents with cybersecurity knowledge
Only 1.38% average failure rate among Talents in phishing assessments
Provided 13 year-round cyber awareness training modules for all Talents
ISO
27001
27001
certification for HKBNES and HKBN JOS data centres and security operations centre
Win-win-win partnership & value chain
Our FY23 progress:
- Created a questionnaire specifically designed to evaluate suppliers’ ESG performance
- 94.8% of suppliers sourced locally within our operating locations
- Implemented criticality assessments to evaluate important projects with amounts greater than HK$300,000
- 34% suppliers have had 10+ year relationships with HKBN
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