United Kingdom

Topic: ESG

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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

Mark Carney speech on climate risk and resilience

On 24 September 2019, the Bank of England (BoE) published two speeches given by Mark Carney, Governor of the BoE at the United Nations Climate Action Summit. In his speech, Dr Carney asserts that for climate risks and resilience to be brought into the heart of financial decision making, climate disclosure must become comprehensive; climate … Continue Reading

Council reaches compromise on EU Sustainable Finance Taxonomy

On 25 September 2019, the Council Permanent Representatives Committee (COREPER II) endorsed the draft compromise text for the European Commission proposal on the Sustainable Finance Taxonomy. At the same time, EU Member States requested the Finnish presidency to commence trilogue negotiations with the European Parliament. The Sustainable Finance Taxonomy is considered a cornerstone of the future … Continue Reading

UN and banks launch Principles for Responsible Banking

On 23 September 2019, during the annual United Nations General Assembly the Principles for Responsible Banking (the Principles) were launched. The Principles have been designed by a core group of 30 ‘founding banks’ together with the UN Environment Programme’s Finance Initiative. They are intended to provide a framework for a sustainable banking system that responds … Continue Reading

Financial industry joins to warn EC about inappropriate timeframe to apply new EU sustainability disclosure rules

On 20 September 2019, a large group of financial industry associations co-published a letter raising concerns to the European Commission regarding the current application timeline for the new EU disclosure rules for sustainable investments and sustainability risks. Whilst supporting the Commission’s objectives of financing a more sustainable economy, the industry associations’ argue that the Regulation … Continue Reading

Don’t forget – 15 October 2019

Earlier this year we reported on PRA Policy Statement 11/19: Enhancing banks’ and insurers’ approaches to managing the financial risks from climate change (PS11/19). In PS11/19 the PRA provided feedback to the responses to its earlier consultation on banks’ and insurers’ approaches to managing financial risks from climate change and set out its final supervisory … Continue Reading

A conversation on the Green Finance Strategy

On July 2, 2019, the Government published its policy paper on the Green Finance Strategy – a strategy that “recognises the role of the financial sector in delivering global and domestic climate and environmental objectives.” Imogen Garner, partner in the Financial Services team, Glenn Hall, partner and head of the Government Relations and Public Policy … Continue Reading

NGFS technical supplement to report on climate change as a source of financial risk

On 23 July 2019, the Network for Greening the Financial System (NGFS) published a technical supplement to its first comprehensive report on climate change as a source of financial risk which is aimed at central banks and financial supervisors. The paper provides an analysis of two types of risks that arise from climate change: physical … Continue Reading

FCA statement on the Joint Declaration on climate change

On 2 July 2019, the FCA published a Joint Declaration with the PRA, the Pensions Regulator and Financial Reporting Council, welcoming the publication of the Government’s Green Finance Strategy and setting out a shared understanding of the financial risks and opportunities of climate change. The FCA welcomes the Chancellor’s announcement that the FCA will have … Continue Reading

ESMA consults on short-termism in financial markets

On 24 June 2019, the European Securities and Markets Authority (ESMA) published a questionnaire which aims to gather evidence on potential short-term pressures on corporations stemming from the financial sector. By December 2019, ESMA will deliver a report to the European Commission based on its findings, in line with the Commission’s request to each of … Continue Reading

Reports of European Commission technical expert group on sustainable finance

On 18 June 2019, the European Commission published new guidelines on corporate climate-related information reporting, as part of its Sustainable Finance Action Plan. The guidelines are intended to provide companies with practical recommendations on how to better report the impact that their activities are having on the climate as well as the impact of climate … Continue Reading

New note on IOSCO report on sustainable finance

We have published a new two-part briefing note summarizing the International Organization of Securities Commission’s (IOSCO) report of 5 June 2019 on sustainable finance in emerging markets and the role of securities regulators (our blog is here). The report takes a cross-border look at how emerging jurisdictions are implementing measures to promote the development of … Continue Reading