On 16 July 2021, the Dutch Central Bank (De Nederlandsche Bank, DNB) published a consultation version of a good practices and Q&A document on the integration of climate-related and environmental risks in the risk management of investment firms and (managers of) investment funds (the Good Practices Document). According to DNB, climate-related and environmental risks can … Continue Reading
Earlier this year, the European Supervisory Authorities (ESAs) published a final report containing draft regulatory technical standards (RTS) on the content, methodologies and presentation of sustainability-related disclosures under the empowerments set out in Articles 2a, 4(6) and (7), 8(3), 9(5) and 10(2) and 11(4) of the Sustainable Finance Disclosure Regulation (SFDR). At the time of … Continue Reading
On 12 July 2021, the Platform on Sustainable Finance (a permanent expert group of the European Commission) issued the following documents: A draft report for a social taxonomy. A consultation report on Taxonomy extension options linked to environmental objectives. The two draft reports are important steps in the Platform’s main deliverables to advise the Commission … Continue Reading
On 7 July 2021, the Financial Stability Board (FSB) published a letter from its Chair, Randal K. Quarles, to G20 Finance Ministers and Central Bank Governors ahead of their 9 – 10 July 2021 meeting. Among other things the letter stresses the need for coordinated action to address financial risks posed by climate change, noting … Continue Reading
On 6 July 2021, the European Commission (the Commission) published its Renewed Sustainable Finance Strategy (RSFS). The RSFS follows the Commission’s 2018 Sustainable Finance Action Plan, which aimed to channel more investment towards environmentally sustainable activities. Under the 2018 Sustainable Finance Action Plan, the Commission presented two main legislative proposals establishing the building blocks for … Continue Reading
On 6 July 2021, the European Commission published a legislative proposal on European green bonds (the EuGB Regulation). The EuGB Regulation will lay the foundation for a common framework of rules regarding the use of the “European Green Bond” (EuGB) designation for bonds that pursue environmentally sustainable objectives as defined by the Taxonomy Regulation.[1] It … Continue Reading
On 30 June 2021, the International Organization of Securities Commissions (IOSCO) issued a consultation report on recommendations for sustainability-related practices, policies, procedures and disclosure in asset management. The consultation report focuses on investor protection issues and proposes that securities regulators consider setting regulatory and supervisory expectations for asset managers regarding sustainability-related risks and opportunities. The … Continue Reading
On 28 June 2021, the International Organization of Securities Commissions (IOSCO) issued a report on issuers’ sustainability-related disclosures. The report: Provides background and context to IOSCO’s work in the area of sustainability disclosures. Summarises the work that IOSCO has done to develop its vision for an International Sustainability Standards Board (ISSB) under the International Financial … Continue Reading
On 23 June 2021, the European Banking Authority (EBA) published a report on the management and supervision of environmental, social and governance (ESG) risks. The report has been prepared in accordance with Article 98(8) of the Capital Requirements Directive V (CRD V) and Article 35 of the Investment Firms Directive (IFD). These provisions mandate the … Continue Reading
On 16 June 2021, the European Commission published an EU Taxonomy Compass which provides a visual representation of the contents of the EU Taxonomy, starting with the Delegated Act on the climate objectives, as adopted on 4 June 2021. Going forward, the EU Taxonomy Compass will be updated to include future delegated acts specifying technical … Continue Reading
On 4 June 2021, there was published on the European Commission’s website: Adoption of the EU Taxonomy Climate Delegated Act (not in force until it is published in the Official Journal). Impact assessment accompanying the EU Taxonomy Climate Delegated Act. Summary of the impact assessment accompanying the EU Taxonomy Climate Delegated Act. Opinion of the … Continue Reading
On 7 June 2021, the Network for Greening the Financial System (NGFS) announced the following new documents: A new set of climate scenarios. In this second vintage, the NGFS scenarios have been brought up to date, including by incorporating countries’ commitments to reach net-zero emissions. They have also been enriched with an expanded set of … Continue Reading
On 7 June 2021, the Task Force on Climate-Related Financial Disclosures (TCFD) issued two documents for public comment: Proposed Guidance on Climate-related Metrics, Targets, and Transition Plans. When the TCFD issued its Final Recommendations in 2017, it was aware of the limitations of reporting certain metrics as well as the nascency of climate-related reporting at … Continue Reading
On 21 May 2021, the European Banking Authority (EBA) published the findings of its first EU-wide pilot exercise on climate risk. As the EU taxonomy and climate risk stress test frameworks are still developing, the pilot exercise was designed as a learning exercise to investigate how existing and newly developed climate risk assessment and classification … Continue Reading
On 11 May 2021, the United Nations Environment Programme published guidance on financial inclusion and financial health target setting. The guidance supports signatory banks in their efforts to set targets for financial inclusion and financial health, in line with the requirements of the Principles for Responsible Banking. Using the guide, banks can understand how to … Continue Reading
On 7 May 2021, the European Commission issued a call for public feedback on a draft Delegated Regulation specifying the disclosure obligations under Article 8 of the Taxonomy Regulation. The Commission has also published FAQs on the draft Delegated Regulation and how will it work in practice. Under Article 8(1) of the Taxonomy Regulation certain … Continue Reading
On 21 April 2021, the United Nations Environment Programme Finance Initiative (UNEPFI) published guidelines for climate targets setting for banks. The guidelines outline key principles to underpin the setting of credible, robust, impactful and ambitious targets in line with achieving the objectives of the Paris Agreement. The guidelines outline four principles for target-setting: Banks shall … Continue Reading
The European Commission has adopted a series of delegated regulations that help to drive investors towards more sustainable economic activities. The measures are part of the European Green Deal. The adopted delegated regulations are part of a suite of sustainability measures adopted at the same time including the EU Taxonomy Climate Delegated Act and the … Continue Reading
The European Commission (Commission) has published a number of legislative and regulatory initiatives in the context of its Sustainable Finance Action Plan. The aim of the Sustainable Finance Action Plan, which was first presented in 2018, is to channel more investment towards sustainable activities. The Commission has published the following initiatives: A Delegated Regulation under … Continue Reading
On 14 April 2021, the Basel Committee on Banking Supervision (Basel Committee) published a report ‘Climate-related risk drivers and their transmission channels’. The report explores how climate-related financial risks can arise and impact both banks and the banking system. By synthesising existing literature, it illustrates how physical and transition climate risk drivers affect banks’ financial … Continue Reading
On 6 April 2021, the Financial Stability Board (FSB) published a letter from its Chair, Randal K. Quarles, to G20 Finance Ministers and Central Bank Governors ahead of their virtual meeting on 7 April. The FSB also delivered to the G20 a report on factors to be considered in extending, amending and ending COVID-19 support … Continue Reading
On 22 March 2021, the Dutch Central Bank (De Nederlandsche Bank, DNB) published its first progress report on financial climate-related risks and opportunities in its areas of responsibility. This report has been incorporated in annex 1 of DNB’s annual report for 2020 (the annual report is currently only available in Dutch; the English version will … Continue Reading
On 18 March 2021, the European Central Bank (ECB) published a blog post by its Vice-President, Luis de Guindos. The blog post, Shining a light on climate risks: the ECB’s economy-wide climate stress test, describes the framework for the economy-wide climate stress test that the ECB is currently conducting. The stress test is the first … Continue Reading
