On August 20, 2021, Hong Kong’s Securities and Futures Commission (SFC) published its conclusions (the “Consultation Conclusions“) from last year’s consultation (the “Consultation“) on proposed amendments to the Fund Manager Code of Conduct (FMCC) that will require fund managers to consider climate-related risks in their governance, investment and risk management processes. The Consultation Conclusions set out the SFC’s analysis of the responses to the Consultation, as well as the final amendments to the FMCC that will require fund managers to implement a range of climate-related practices as early as August 20, 2022.

In this Blog Post, we provide a high-level overview of the amendments to the FMCC and highlight key takeaways from the Consultation Conclusions as Hong Kong enters a new phase of sustainable fund management.


Continue Reading Hong Kong SFC Finalizes Climate Risk Requirements for Fund Managers

The Voluntary Carbon Markets Integrity Initiative (VCMI), a global task force initiated to monitor the integrity of voluntary markets for the purchase and sale of carbon offset credits, held a global launch event and issued its consultation report (VCMI Report) in late July. The VCMI Report seeks to provide further guidance

On 20 July 2021, the Hong Kong Monetary Authority (HKMA) issued draft guidelines (the Draft Guidelines) on the management of climate-related risks by authorised institutions (AIs). The Draft Guidelines further develop the HKMA’s approach to climate risk, initially outlined in its June 2020 White Paper on Green and Sustainable Banking, and incorporate leading international standards and practices to provide comprehensive climate risk management guidance for banks in the areas of governance, strategy, risk management and disclosure.

In this Blog Post, we highlight key aspects of the Draft Guidelines and takeaways for AIs considering how to approach these new proposals in Hong Kong. For more information about evolving regulatory approaches to climate disclosure and risk management around the world, please see our comprehensive analysis, Climate Disclosure and Risk Management: Global Approaches.


Continue Reading Hong Kong Proposes Climate Risk Management Guidelines for Banks

On 8 April 2021, we discussed in our blog post the UK government’s consultation on the draft climate risk regulations under the Pension Schemes Act 2021. The government has recently published a response to the draft regulations, the finalised regulations and the accompanying statutory guidance. The new regulations will apply to trustees of larger

In our blog post on 13 May 2021, we discussed the consultation papers published by the China Securities Regulatory Commission (“CSRC”) on proposed ESG-related amendments to the disclosure rules applicable to listed companies. On 28 June 2021, the CSRC published the final set of amendments (“Final Amendments”) to the disclosure rules applicable to annual reports and half-year reports, respectively, together with relevant explanations to the amendments (“Explanations”).

Continue Reading China Publishes Environmental and Social Disclosure Rules for Listed Companies

The EU Green Deal announces a zero pollution ambition for a toxic-free environment that should be achieved, among other ways, through ambitious actions against the most hazardous chemicals and enhanced engagement in innovation for the development of safe and sustainable alternatives. One of the first deliverables of this far-reaching policy program is the Chemicals Strategy for Sustainability (CSS), which involves important revisions of the existing EU chemicals legislation including the Chemicals Control Regulation (REACH) and the Classification, Labelling and Packaging Regulation (CLP).

REACH and the CLP are the two main instruments and actual cornerstones of the EU chemicals legislation. They will be simultaneously reopened and revised between now and the end of 2022, with the affirmed objective to improve the protection of people and the environment in line with the Green Deal’s ambition. While the CSS announces this revision and the reinforcement of the existing provision, it provides little clarity as to the exact scope of the revision plan. It is thus rather unclear how important such revisions are intended to be.

On May 4, 2021, the European Commission published two important roadmaps that provide insights on the intentions of the EU executive on the framework for the revised REACH and CLP. The Commission elaborates on the legal and regulatory options that it can consider. Although targeted, the options envisaged by the Commission will certainly lead to significant revisions to the REACH and CLP, and in fact may in some instances constitute a real shift in paradigm.

Continue reading for additional background on the roadmaps and the implications for REACH and CLP in the future.


Continue Reading EU Green Deal: EC Releases Roadmaps Toward an Ambitious Revision of REACH and CLP

On April 26, 2021, the Central Bank of Brazil (BCB) launched a new public consultation (No. 86/2021, the “Consultation”) on a proposed regulation for mandatory disclosure of social, environmental, and climate risks by financial institutions.

Climate-related risks must be disclosed in accordance with the TCFD Recommendations (“Recommendations”), including both

On April 16, 2021, the Stock Exchange of Hong Kong Limited (SEHK) issued a consultation paper (the “Consultation“) seeking public comment on proposed amendments to the SEHK’s Corporate Governance Code and Listing Rules intended to promote good corporate governance practices among listed companies and IPO applicants. Amidst the global surge in

Following in the footsteps of other central banks around the world, and in face of the pressing need for an inclusive and sustainable economic recovery after the COVID-19 pandemic, on April 7, 2021, the Central Bank of Brazil (BCB) launched public consultation No. 85/2021 (Consultation). The Consultation includes proposed amendments and new rules governing the management of social, environmental and climate risks by financial institutions (and other institutions with operations authorized by the BCB), as well as the requirements to be observed by these institutions in the elaboration and implementation of their respective Social, Environmental and Climate Responsibility Policy (PRSAC).

The BCB joined the Network for Greening the Financial System (NGFS) on March 25, 2020, and, on September 8, 2020, launched the “Sustainability Dimension” of its work agenda (Agenda BC#), which aims to promote sustainable finance, proper management of social, environmental and climate risks in the National Financial System (SFN), and integration of ESG variables into BCB’s decision-making process.


Continue Reading Brazil’s Central Bank Set to Incorporate Social, Environmental and Climate Factors into Financial Regulation

On April 6, 2021, the Council of Experts Concerning the Follow-up of Japan’s Stewardship Code and Japan’s Corporate Governance Code (Council) published a consultation on proposed revisions to Japan’s Corporate Governance Code (Governance Code) and Guidelines for Investor and Company Engagement (Guidelines) intended to, among other things, increase attention to sustainability and ESG matters and promote diversity among Japan’s listed companies.

The Governance Code sets out the fundamental principles for effective corporate governance of listed companies in Japan, while the Guidelines provide agenda items for engagement that institutional investors and companies are expected to focus on. The proposed revisions to these two documents could significantly influence the state of ESG and diversity among Japan’s listed companies, with a key emphasis on sustainability-related disclosures.

In this Blog Post, we provide additional background on the Governance Code and the Guidelines, as well as details and analysis of the consultation proposals.


Continue Reading Japan to Promote ESG Disclosures and Diversity for Listed Companies