On March 10, 2021, the UK government concluded its public consultation on climate risk regulations under the Pension Schemes Act 2021. The government is now analyzing public feedback and preparing consultation conclusions.

In a new podcast, Mayer Brown Counsel Beth Brown provides background on the Pension Schemes Act 2021 and outlines the regulations in the

Camellia plc and certain of its subsidiary companies have recently settled legal claims in the United Kingdom based on allegations against two businesses in Camellia plc’s African operations, namely Kakuzi in Kenya and EPM in Malawi. The claimants – supported by the Kenyan Human Rights Commission, the Centre for Research on Multinational Corporations (SOMO) and the Ndula Resources Centre – had alleged personal injuries suffered by local residents in Kenya allegedly carried out by security guards employed by Kakuzi in Kenya and sexual harassment and gender-based violence suffered by EPM’s female employees in Malawi. These claims have now been resolved at settlements costing up to £4.6m in relation to the Kenyan claims, and £2.3m in relation to the Malawian claims (see Camellia’s trading statement here).

The settlement highlights the role and importance of remedial community measures and Operational-level Grievance Mechanisms, as well as the increased exposure to litigation of parent companies for human rights related failures by their subsidiaries (for further examples, see our coverage here and here).


Continue Reading Business and Human Rights: Operational-level Grievance Mechanisms Form Part of Camellia plc’s Settlement of Claims in Connection with Operations in Kenya and Malawi

In a speech on March 17, 2021, the CEO of the UK’s Financial Conduct Authority (FCA), Nikhil Rathi, highlighted how the financial services regulator is prioritizing diversity and inclusion (D&I) initiatives in the near term. Speaking at the launch of the HM Treasury Women in Finance Charter Annual Review, Mr. Rathi outlined why D&I is a key consideration for the FCA, noting that:

“We care because diversity reduces conduct risk and those firms that fail to reflect society run the risk of poorly serving diverse communities. And, at that point, diversity and inclusion become regulatory issues.”

Key steps the FCA is now taking on D&I include:

  • Working with the Prudential Regulation Authority (PRA) on a joint approach to D&I for all financial services firms; and
  • Considering whether to make diversity requirements a part of the FCA’s premium listing rules, similar to the approach taken by NASDAQ in the US.


Continue Reading UK Regulator to Prioritize Diversity and Inclusion for the Financial Services Industry

On March 11, 2021, the UK Government launched an online modern slavery statement registry. The announcement follows a commitment from the UK Government to strengthen the reporting requirements under section 54 of the Modern Slavery Act 2015 following its Transparency in Supply Chains Consultation.

The registry is intended to enhance transparency and accessibility

On March 3, 2021, the German government adopted a draft bill which obliges companies to ensure that human rights are observed throughout their entire supply chain. The aim of the “draft legislation on corporate due diligence in supply chains” (“Draft Bill”) (“Sorgfaltspflichtengesetz”) is to require companies to take steps to prevent human rights violations in their supply chains. This builds on the growing momentum for mandatory human rights due diligence (see our previous Blog Post).

Under the Draft Bill:

  • companies must ensure that human rights are being respected throughout their entire supply chain;
  • companies must establish complaint mechanisms and report on their due diligence activities;
  • companies with more than 3,000 employees must meet their due diligence obligations as of January 1, 2023 (and companies with more than 1,000 employees as of 2024);
  • violations of the obligations set forth in the Draft Bill will be sanctioned with fines, which can amount to up to 2% of the average annual turnover for large companies with more than 400 million euros annual turnover.


Continue Reading Business and Human Rights – Germany Adopts Draft Mandatory Human Rights Due Diligence Law

On March 1, 2021, the European Banking Authority (EBA) released its consultation regarding draft technical standards for Pillar 3 disclosures of ESG risks, including reporting templates and instructions.

The European Union’s Capital Requirements Regulation (EU) No. 575/2013 (CRR) includes under Article 449a the requirement to disclose prudential information on ESG

On March 1, 2021, the European Banking Authority (EBA) published advice to the European Commission on the disclosure requirement on environmentally sustainable activities in accordance with Article 8 of the EU’s Taxonomy Regulation. The EBA recommends key performance indicators (KPIs) and related methodology for the disclosure by credit institutions and

The UK Supreme Court has handed down its judgment in the case of Okpabi and others v Royal Dutch Shell Plc and another.  Although the judgment made no substantive findings on the facts of the dispute, the Supreme Court’s decision raised important issues with regard to the circumstances in which a parent company will be held liable for the actions of its subsidiary – including in relation to ESG-related harms, such as environmental damage.

Continue Reading UK Supreme Court Clarifies Parent Company Liability for ESG-Related Harms Caused by Foreign Subsidiaries

On February 24, 2021, Acting Chair of the US Securities and Exchange Commission (SEC), Allison Herren Lee, announced that the agency will focus on public companies’ climate change disclosures as part of an effort to both assess current compliance with federal securities laws and develop new disclosure requirements for climate change.

Specifically, she

How will EU Member States enforce the new EU mandatory human rights and environmental due diligence laws? What disclosure will be expected of companies and what steps will be deemed adequate?

Shift, the highly influential centre of expertise on the UN Guiding Principles on Business and Human Rights, has released a discussion draft seeking to inform the development and enforcement of these new laws. The draft provides valuable insight into the criteria that national regulators could use in assessing the quality of a company’s diligence practices by proposing six “signals of seriousness” for human rights due diligence:

  1. Governance of Human Rights;
  2. Meaningful engagement with affected stakeholders;
  3. Risk identification and prioritisation;
  4. Taking action on identified risks;
  5. Monitoring and evaluating progress in addressing risks; and
  6. Providing and enabling remedy.

How many companies can confidently assert that they currently exhibit these six signals? We highlight Shift’s helpful criteria in this Blog Post.


Continue Reading Human Rights Due Diligence: Six Signals of Seriousness