Climate-related litigation is increasingly being used as a tool to hold companies and governments to account over their contributions to climate change.  According to the Grantham Institute’s 2021 Global Trends in Climate Change Litigation Policy Report (the “Report”), the number of climate-related cases has more than doubled since 2015: between 1986 and 2014, approximately

There has been much talk recently about ESG. What started as a metric for investors to make ethical investment decisions has now grown to encompass how companies should, and are expected to, behave in general. ESG is now a key issue for company boards and management, and an important consideration for shareholders and investors, individual

In a further effort to help listed companies align their ESG-related disclosures in line with other international standards and best practices, and to build on ESG reporting landscape in Singapore, the Monetary Authority of Singapore (MAS) and the Institute of Banking and Finance (IBF) have identified 12 technical skills and competencies for professionals within the sustainable finance sector.

The Sustainable Finance Technical Skills and Competencies (SF TSCs) are part of the IBF Skills Framework for Financial Services which seeks to provide vital information to upskill and train current and incoming talent within banks, asset management and insurance sectors to strengthen their sustainability-related offerings and services.

Continue Reading Singapore Seeks to Bolster Skillset for its Sustainable Finance Professionals

On February 9, 2022, the U.S. Federal Housing Finance Agency (“FHFA”) released its Draft FHFA Strategic Plan: Fiscal Years 2022-2026 (the “2022 Strategic Plan”) for public input.

This year, FHFA added a novel objective to this plan – to identify options for incorporating climate change into FHFA’s governance of the entities it regulates.

According to FHFA Acting Director Sandra L. Thompson, the 2022 Strategic Plan provides a roadmap for FHFA to promote sustainable and equitable access to mortgage credit and protect the safety and soundness of the U.S. housing system. While not a statutory requirement, the FHFA uses its strategic planning process to set priorities based on important stakeholder input. Typically, FHFA releases a strategic plan every few years, outlining the agency’s priorities for the supervision and regulation of the Federal Home Loan Banks, and of Fannie Mae and Freddie Mac (the “Enterprises”). The agency sets forth those priorities through strategic goals and objectives to achieve those goals.

Continue Reading FHFA’s Strategic Plan Adds Focus on Climate Change

The recent publication, on 27 February 2022, of the second instalment to the Sixth Assessment Report of the UN’s Intergovernmental Panel on Climate Change (“IPCC“) did not receive the same degree of attention as the first instalment in August 2021.  The findings, and message, of the second instalment, are no less severe, or potentially consequential, however, delivering as it does, the “bleakest warning yet” of the impacts of climate change.

The first instalment, developed by the IPCC’s Working Group I, focused on the physical science basis of climate change.  The second instalment, developed by the IPCC’s Working Group II, assesses the impacts of climate change, looking at ecosystems, biodiversity and human communities at global and regional levels.

The findings of the IPCC are, of course, deeply troubling in many respects, and the implications of those findings are likely to be extensive.  One area in which those implications are likely to be felt is that of climate litigation.  As explored in our previous article, the science based findings of the IPCC have played a role in affirming international legal standards on climate change and establishing the link between emissions and climate change, thereby – in some respects – strengthening the cases of climate litigants who may previously have encountered difficulties in establishing causation.  The ever-increasing urgency of the climate crisis, and the willingness – and ability – of stakeholders to use litigation to compel action to address that crisis, will continue to be features of the landscape as attention focuses on the IPCC’s findings.

Continue Reading Climate Change Litigation: the IPCC’s latest Report links climate change to loss and damage

In a recent Legal Update[1], we discussed the emerging intersection between Tax and ESG and highlighted the various external stakeholders pressuring for greater visibility into the global tax positions of multinational companies (MNEs).  One increasingly vocal stakeholder group is activist shareholders.  Recently, a group of institutional investors of a Fortune 50 company initiated a shareholder proposal calling for the company to publicly disclose where and how much tax it pays around the world.  This is only the latest in what is becoming a regular request by activist shareholders.

Continue Reading Tax Meets ESG: Shareholder Activism Expanding to Tax Transparency

In a recent Legal Update[1], we discussed the intersection between Tax and ESG and the challenges companies will face responding to external pressures for greater transparency into a company’s global tax position.  We predicted that once the SEC reporting season began this month, the press would focus on the effective tax rates of high-profile companies.  That is exactly what happened recently when a leading national news outlet reported on the tax position of a well-known multinational.  The article paints an unflattering picture of the multinational’s global tax position and makes generalized observations on structures it might have used to achieve its tax results.  In this blog post, we discuss how companies can prepare for similar reporting.

Continue Reading Tax Meets ESG: Preparing for Bad Press

On 11 February, the European Securities and Markets Authority (“ESMA“) published its Sustainable Finance Roadmap for 2022-2024 (the “Roadmap“).

The Roadmap builds on ESMA’s 2020 Strategy for Sustainable Finance and will be of interest to those in the EU and beyond looking to understand the focus and ambition of the EU’s

“Delivering effective corporate governance practices and ESG measures is more than a box-ticking exercise. The change needs to begin with a shift of mindset at the top of the organisations.” – SEHK, December 2021

On December 10, 2021, the Stock Exchange of Hong Kong Limited (SEHK) published the conclusions from its April 2021 consultation on amendments to the SEHK’s Corporate Governance Code (the Code) and Listing Rules intended to promote good corporate governance practices among listed companies and IPO applicants. The final amendments address a range of topics that could significantly change the way that the boards of covered entities operate, including with respect to gender diversity, ESG reporting timelines and the role that ESG plays in corporate governance structures and processes.

In this Blog Post, we highlight final amendments to the Code and the Listing Rules addressing the link between ESG and good corporate governance, ESG reporting and gender diversity at both the board and workforce levels.

Continue Reading ESG and Gender Diversity Requirements Finalized for Listed Companies and IPO Applicants in Hong Kong

On November 26, 2021, Hong Kong’s Mandatory Provident Fund Schemes Authority (MPFA) advanced the Special Administrative Region’s sustainable finance strategy with new Principles for Adopting Sustainable Investing in the Investment and Risk Management Processes of MPF Funds (the Principles). The Principles lay out a high-level ESG integration framework for trustees of Mandatory Provident Funds (MPF), the investment vehicles for the Hong Kong’s mandatory retirement protection scheme, across four key elements: governance, strategy, risk management and disclosure.

In this Blog Post, we provide a brief overview of the Principles and highlight each element, as well as important next steps for MPF trustees. We also provide guidance on how companies are already implementing ESG frameworks similar to the Principles.

Continue Reading Hong Kong Regulator Issues Sustainable Investing Principles for Pension Fund Trustees