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European Parliament compromise text on a Proposed Regulation on sustainable investment framework

On 24 January 2020, the European Parliament published an updated version of the procedure file for the proposed Regulation on the establishment of a framework to facilitate sustainable investment (known as the ‘Taxonomy Regulation’). The procedure file states that, on 16 January 2020, there was approval in committee of the text of the Taxonomy Regulation, … Continue Reading

EU technical expert group on sustainable finance handbook on climate benchmarks and ESG disclosures

On 20 December 2019, the EU technical expert group on sustainable finance (TEG) published a handbook on climate benchmarks and benchmarks’ environmental, social and governance (ESG) disclosures (the Handbook). The Handbook has been produced in response to frequently asked questions that the TEG encountered when presenting the EU Climate Transition Benchmark, the EU Paris Aligned … Continue Reading

Third meeting of the PRA and FCA’s joint Climate Financial Risk Forum

On 18 December 2019, the PRA and FCA published an update concerning their joint Climate Financial Risk Forum (CFRF) meeting in November. The update makes the following points: the meeting discussed the form of the outputs and the timeline for publishing them, as well as how to get wider industry input on draft guidance and … Continue Reading

Bank of England consults on its proposals for stress testing the financial stability implications of climate change

On 18 December 2019, the Bank of England (BoE) published a discussion paper which sets out its proposed framework for the 2021 Biennial Exploratory Scenario (BES) exercise. The objective of the BES is to test the resilience of the largest banks and insurers to the physical and transition risks associated with different possible climate scenarios, … Continue Reading

Council of EU invites approval of final compromise text of proposed ‘taxonomy Regulation’

On 18 December 2019, the Council of the EU (Council) published an ‘I’ Item note (dated 17 December 2019) on the proposed Regulation on the establishment of a framework to facilitate sustainable investment. Following negotiations between the Council and the European Parliament (Parliament), political agreement between the institutions was achieved on 17 December 2019 – … Continue Reading

European Green Deal announced

On 11 December 2019, the European Commission (Commission) presented The European Green Deal – a roadmap for making the EU’s economy sustainable by turning climate and environmental challenges into opportunities across all policy areas. To set into legislation the political ambition of Europe being the world’s first climate neutral continent by 2050, the Commission will … Continue Reading

Linking of Switzerland to the EU emissions trading system – entry into force on 1 January 2020

On 9 December 2019, the European Commission announced that on 1 January 2020 Switzerland will become the first country to successfully link its greenhouse gas emissions trading system with the EU emissions trading system. This completes a process which has taken almost 10 years. On 17 December 2010, the Council authorised the Commission to open … Continue Reading

Disclosure Regulation and Low Carbon Benchmarks Regulation published in OJ

On 9 December 2019, there was published in the Official Journal of the European Union (OJ): Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector (the Disclosure Regulation); and Regulation (EU) 2019/2089 of the European Parliament and of the Council of … Continue Reading

EBA action plan on sustainable finance

On 6 December 2019, the European Banking Authority (EBA) published its action plan on sustainable finance outlining its proposed timeline for delivering mandates relating to environmental, social and governance (ESG) factors. The EBA’s remit and mandates on ESG factors and risks are set out in the following legislative acts: the amended Regulation establishing the EBA; … Continue Reading

Council and Parliament reach provisional compromise on EU Sustainable Finance Taxonomy Proposal

The Council of the EU and the European Parliament have reached a provisional compromise agreement on the Commission proposal for a regulation on the establishment of a framework to facilitate sustainable investments (the Sustainable Finance Taxonomy Regulation). After a fifth round of political trilogue negotiations on 3 December 2019, a sixth round was required on … Continue Reading

40 minute briefing on 4 December – Going green: ESG reforms

Our 40 minute briefing on 4 December will be a seminar, we hope to see you at our London offices. In this briefing members from our Financial Services team and Government Relations team will discuss the EU legislative measures on sustainable finance and the latest green communications from the PRA and FCA. To register your … Continue Reading

Next 40 minute briefing (4 December) – Going green: ESG reforms

Our next 40 minute briefing will be a seminar. In this briefing members from our Financial Services team and Government Relations team will discuss the EU legislative measures on sustainable finance and the latest green communications from the PRA and FCA. To register your place for the briefing please click here.… Continue Reading

ECB speech on regulation, proportionality and the sustainability of banking

On 21 November 2019, the European Central Bank (ECB) published a speech given by Andrea Enria, Chair of the Supervisory Board of the ECB, at the European Savings and Retail Banking Group Conference, “Creating sustainable financial structures by putting citizens first” focusing on banking reforms, the case for a proportionate approach to regulation and sustainable … Continue Reading

ECB speech on implications of the transition to a low carbon economy

On 21 November 2019, the European Central Bank (ECB) published a speech given by Luis de Guindos, Vice-President of the ECB, at the European Savings and Retail Banking Group Conference, “Creating sustainable financial structures by putting citizens first” focusing on the risks for the financial system in relation to climate change and its role in … Continue Reading

Investment Association launches industry-wide definitions on responsible investment

On 18 November 2019, the Investment Association (IA) launched an industry-wide framework aiming to categorise definitions relating to responsible investment. The IA’s responsible investment framework categorises, and provides standard definitions for, the different components of responsible investment. The framework is embedded in a report that intends to provide context, guidance and uses for the framework. … Continue Reading

EU co-legislators hold second round of trilogue negotiations on Sustainable Finance Taxonomy

On Wednesday 6 November 2019 the EU legislators held their second trilogue negotiation round on the proposal for a Regulation on the establishment of a framework to facilitate sustainable investment (hereinafter: the ‘Taxonomy proposal’). The proposed regulation will establish the conditions and the framework to create a unified classification system on what economy activities can … Continue Reading

Next 40 minute briefing (4 December) – Going green: ESG reforms

Our next 40 minute briefing will be a seminar. In this briefing members from our financial services team and Government Relations team will discuss the EU legislative measures on sustainable finance and the latest green communications from the PRA and FCA. To register your place for the briefing please click here.… Continue Reading

Council of EU adopts Disclosure Regulation and Low Carbon Benchmarks Regulation at first reading

On 24 October 2019, the Council of the EU published the texts it adopted at first reading for the: the Regulation on disclosures relating to sustainable investments and sustainability risks in the financial services sector (the Disclosure Regulation); and the Regulation amending the Benchmarks Regulation as regards EU Climate Transition Benchmarks, EU Paris-aligned Benchmarks and … Continue Reading

FCA publishes Feedback Statement on Climate Change and Green Finance

On 16 October 2019, the Financial Conduct Authority (FCA) published its Feedback Statement on Climate Change and Green Finance (FS19/6), setting out a summary of responses to its discussion paper and next steps. Background The Feedback Statement follows the FCA’s Discussion Paper (DP18/8) on Climate Change and Green Finance, published in October 2018, which sought … Continue Reading

Commission consultation on final Basel III reforms – spotlight on ESG risks

As previously blogged, the European Commission (Commission) has launched a public consultation on the implementation of the final elements of the Basel III reforms. Chapter 8 of the Commission consultation document covers sustainable finance. The Commission notes three actions that have been identified by the co-legislators in the course of the recent legislative review of … Continue Reading

Update on the proposed Regulation amending the BMR on low carbon benchmarks and positive carbon impact benchmarks

On 10 October 2019, HM Treasury published a letter (dated 9 October 2019) from John Glen MP, Economic Secretary to HM Treasury, to the Earl of Kinnoull, House of Lords EU Committee Chair, in respect of the proposed Regulation amending the Benchmarks Regulation (BMR) on low carbon benchmarks and positive carbon impact benchmarks. Mr Glen … Continue Reading

Mark Carney speech on sustainable finance to TCFD summit

On 8 October 2019, the outgoing Governor of the Bank of England, Mark Carney, gave a speech on TCFD: strengthening the foundations of sustainable finance, to the Task Force for Climate-related Financial Disclosures (TCFD) Summit in Tokyo. In his speech Dr Carney takes stock of the progress made to date since the final TCFD recommendations were … Continue Reading

Technical Expert Group makes recommendations for methodology of EU climate benchmarks

On 30 September 2019, the Technical Expert Group on Sustainable Finance (TEG), a stakeholder group designed to assist the European Commission in developing elements of green finance policy, issued its final report on climate benchmarks. The TEG recommends a set of minimum technical requirements for the methodology of EU Climate benchmarks. These would serve to … Continue Reading

ESG: German regulator launches consultation regarding guidance notice on sustainability

On 24 September 2019, the German Federal Financial Supervisory Authority (BaFin) published a draft guidance notice on dealing with sustainability risks for consultation (link; only available in German). BaFin expects supervised entities to also take into account environmental risks, social risks and risks arising from corporate governance (commonly referred to as environmental, social and governance – … Continue Reading
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