On 14 May 2024, the European Securities and Markets Authority (“ESMA“) published its final report on “Guidelines on funds’ names using ESG or sustainability-related terms” (the “Guidelines“). The Guidelines aim to provide fund managers with clear and measurable criteria to assess their ability to use ESG and/or sustainability-related terms
Climate disclosure regulations are among the most significant and complex challenges faced by companies and boards, with a variety of requirements emanating from numerous governmental authorities and non-governmental organizations (NGOs) in recent years. Mayer Brown lawyers from around the world produced a White Paper on Global Climate Change Disclosure Initiatives and Board Corporate Governance Considerations
Climate disclosure regulations are among the most significant and complex challenges faced by companies and boards, with a variety of requirements emanating this past year from numerous governmental authorities and non-governmental organizations. This white paper—an expanded version of a white paper we published in January—discusses key features and differences of a dozen authorities, followed by
The European Securities and Markets Authority (“ESMA“) has today published three useful explanatory notes covering key topics of the European sustainable finance framework, namely: a) the definition of “sustainable investments”; b) the application of do no significant harm (“DNSH“) principle; and c) the use of estimates.
The explanatory notes set out
Our international ESG team has been keeping an eye on what’s going on with regards to green taxonomies. With so much activity already this year, we summarize some of the key developments below.
EU
We recently published this reminder of the EU’s taxonomy framework. Our publication is particularly relevant to non-EU groups with large subsidiaries
On 11 July 2023, the European Securities and Markets Authority (ESMA) published a public statement on sustainability disclosure in prospectuses, available here: ESMA32-1399193447-441 Statement on sustainability disclosure in prospectuses (europa.eu).
The statement is addressed to the National Competent Authorities (NCAs) to promote coordinated action regarding sustainability-related disclosure included in prospectuses under current legislation. While the statement is addressed to NCAs, ESMA have said that its contents should be taken into account by issuers and advisers when drawing up a Prospectus Regulation (PR) compliant prospectus that contains sustainability-related disclosure.
Whilst there is little in the way of deviation from best practice here, the statement reflects the enhanced focus of ESMA and NCAs on ESG disclosure and is likely to result in additional commentary from NCAs during the prospectus approval process.
A summary of some of the key takeaways is included below.Continue Reading ESMA release Public Statement on Sustainability Disclosures in Prospectuses
The risk of an accusation of “greenwashing” is now an important concern for many companies. Greenwashing is an ill-defined concept but, nevertheless, is increasingly a source of litigation and regulatory scrutiny – with more of both expected. It carries with it reputational, regulatory and litigation risks for which companies should be prepared. Whilst the risks are always context specific – varying by jurisdiction, industry
On 10 November 2022, the EU Parliament adopted the Corporate Sustainability Reporting Directive (“CSRD“). The EU Council is expected to adopt the CSRD on 28 November 2022, after which it will be published in the Official Journal. The CSRD will then enter into force 20 days after publication and EU member states will have 18
In response to growing investor demand for information concerning companies’ sustainability-related financial risks, the sustainability disclosure landscape has rapidly changed over the last decade. In what marks one of the latest developments to the sustainability disclosure landscape, on 29 April 2022, the European Financial Reporting Advisory Group (“EFRAG“) – a private organisation that provides technical assistance to the European Commission – issued its initial draft European Sustainability Reporting Standards (“ESRS“) for public comment. The ESRS, which EFRAG were tasked with preparing by the European Commission as part of the proposed Corporate Sustainability Reporting Directive (“CSRD“), set out proposed requirements for companies to report on sustainability-related impacts, opportunities and risks under the CSRD.Continue Reading The European Financial Reporting Advisory Group issues draft European Sustainability Reporting Standards
On 22 October 2021, the three European Supervisory Authorities (EBA, EIOPA and ESMA – the “ESAs“) delivered to the European Commission the expected Final Report with draft Regulatory Technical Standards (RTS) with respect to additional pre-contractual and periodic disclosure relating to financial products that make sustainable investments contributing to environmental objectives (“Draft SFDR Amendment RTS” – JC 2021 50). By virtue of such new draft rules, the EU will regulate the market by establishing standardized disclosures.
Under a formalistic approach, such new Draft SFDR Amendment RTS as level 2 measures under the EU Sustainable Finance Disclosure Regulation (“SFDR“, Regulation (EU) 2019/2088) aim to
Continue Reading New EU Rules for Taxonomy-Related Product Disclosures