The regulator is providing temporary flexibility in light of concerns that asset managers need extra time to prepare.
By Nicola Higgs, Jaime Martin, Sara Sayma, and Charlotte Collins
On 9 September 2024, the FCA published a statement on its naming and marketing rules under the Sustainability Disclosure Requirements (SDR) regime, allowing asset managers more time to get ready for the new requirements.
The SDR is being implemented on a staggered basis; the new investment labels have been
The FAQs aim to clarify key aspects of the CSRD, including the scope of the rules, compliance dates, and exemptions.
By Paul A. Davies, Axel Schiemann, Michael D. Green, James Bee, and Lasse Winzer
On 7 August 2024, the European Commission (Commission) published a set of frequently asked questions (FAQs) on the interpretation of certain provisions of the EU Corporate Sustainability Reporting Directive (CSRD). The FAQs aim to facilitate compliance and ensure the usability and comparability
The draft represents the next step in transposing the CSRD into national law.
By Axel Schiemann and Dominik Schöneberger
On 24 July 2024, the German Federal Government adopted the governmental draft of the Act implementing the EU Directive on Sustainability Reporting (Directive (EU) 2022/2464 – CSRD) into German law (the Government Draft). The adoption of the Government Draft constitutes the next significant step in the legislative process after the German Ministry of Finance published the first draft implementing law on
The ESAs urge the European Commission to consider a labelling rather than a disclosure regime to help consumers understand the sustainability goals of financial products.
By Nicola Higgs, Jaime Martin, Sara Sayma, and Charlotte Collins
On 18 June 2024, the European Supervisory Authorities — the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA), and the European Securities and Markets Authority (ESMA), collectively the ESAs — published a joint opinion on the Sustainable Finance
Private capital providers, investors, asset managers, and financial institutions will likely continue to face a fragmented regulatory landscape on ESG matters.
By Betty M. Huber, Matthew Green, Henry Miller, Austin J. Pierce, Catherine G. Willis, and Sam Wong
Various US states have taken and continue to take action on ESG investing and other matters, with new variants emerging regularly. Some of the state bills, laws, and actions overlap thematically, and indeed some are based on
Guidelines indicate when asset managers may legitimately use ESG or sustainability-related terms in their fund names.
By Nicola Higgs, Laura Ferrell, and Charlotte Collins
On 14 May 2024, ESMA published its final Guidelines on funds’ names using ESG- or sustainability-related terms. The Guidelines aim to address the risk of funds’ names misleading investors by ensuring that their names can be supported in a material way by evidence of sustainability characteristics or objectives that are reflected fairly and consistently in the fund’s investment objectives and policy.
ESMA originally consulted on the Guidelines in November 2022 (see this blog post), but finalisation has been delayed while reviews of the AIFMD and UCITS Directive were completed. Notably, ESMA received substantive feedback on the consultation and made several amendments to the Guidelines accordingly.
With regulators keeping close watch, the results underscore the need for ongoing climate risk management investment and adaptation within the financial sector.
By Betty M. Huber, Arthur S. Long, Pia Naib, and Deric Behar
On May 9, 2024, the Board of Governors of the Federal Reserve System (FRB) published summary results of a pilot climate scenario analysis (CSA) that explored how resilient six of the largest US bank holding companies (by total assets) are to climate-related financial risks. The analysis is intended to help the FRB “learn about large banking organizations’ climate risk-management practices and challenges and to enhance the ability of large banking organizations and supervisors to identify, estimate, monitor, and manage climate-related financial risks.”
The CSA was first announced in September 2022, and was intended as an exploratory exercise. It does not therefore result in any capital or supervisory consequences for the participating financial institutions.
The final guidance clarifies the scope and application date of the rule, and answers questions around good practice and accessing third-party data.
By Nicola Higgs and Jaime Martin
On 23 April 2024, the FCA published its final guidance (FG23/4) on its new anti-greenwashing rule, which comes into force on 31 May 2024. The anti-greenwashing rule will require all authorised firms to ensure that any reference they make to the sustainability characteristics of their financial products and services are
The Sexism in the City report highlights key issues affecting women in financial services and sets out a number of recommendations to address them.
By Nell Perks, Ella McGinn, and Charlotte Collins
On 8 March 2024, the House of Commons Treasury Committee published its report from the Sexism in the City inquiry, which sought to explore progress in four key areas affecting women in financial services since the Committee’s Women in Finance report was published in 2018. Overall
The European Parliament and the Council of the EU have made some significant changes to the European Commission’s proposal.
On 5 February 2024, the European Parliament and Council of the EU announced that they had reached a provisional political agreement on the text of the ESG Ratings Regulation (the Regulation). The agreed text was subsequently published on 14 February 2024. The Regulation was initially proposed by the Commission in June 2023, and seeks to introduce a new regulatory regime for ESG ratings providers “operating in the Union”. Refer to this Latham blog post for previous commentary on the proposal.