ESG

Recent Articles

•  

  15.12.2022

  FCA - Un­der­stand­ing ap­proaches to D&I in fin­an­cial ser­vices

  The FCA conducted its review via 12 regulated firms – 8 with large gender pay gaps and 4 with relatively small pay gaps. The average pay gap for the financial services market is 26.6%, which is far higher than the average for the wider UK market which is 12.1%. In conducting its review, the FCA asked each firm for some basic information including about their D&I policy and strategy, target setting initiatives and D&I data used. The FCA also requested a 90-minute structured interview with a senior individual and any relevant specialists at each firm. It is clear from the review that...

  Read more
•  

  29.11.2022

  New code of con­duct for ESG rat­ings and data pro­viders

  Many firms are making their ESG claims heavily reliant on the use of unregulated ESG data and ratings providers. This is particularly problematic as data availability and ESG resources can be challenging. There is often frustration from financial services firms at some ESG data and ratings providers' lack of transparency on their methodology in assessing and scoring how green or socially impactful an investment prospect may be, and in the accountability the providers have for their services. Financial services firms are themselves in the firing line for greenwashing, and while they try to meet...

  Read more
•  

  17.11.2022

  ESG: A sum­mary of the FCA’s Sus­tain­ab­il­ity Dis­clos­ure Re­quire­ments (SDR) and in­vest­ment la­bels con­sulta­tion pa­per (CP22/20)

  The updated proposals are materially different to those set out in the FCA’s November 2021 Discussion Paper (DP21/4), reflecting the strength of feedback on the Discussion Paper and the fast pace of change in this area both in the UK and internationally. A remarkably long 179 pages, the Consultation Paper has a substantial amount of information to consider that will impact not only product and entity level disclosures, but governance and organisational requirements too. We recommend that clients establish the impact of the Consultation Paper proposals as soon as possible, with a view to providing...

  Read more
•  

  14.10.2022

  ESMA Guidelines on suit­ab­il­ity up­dated to take in­to ac­count sus­tain­ab­il­ity factors, risks and pref­er­ences of the cli­ents

  Firms (that are inter alia investment firms and credit institutions) (i) providing investment advice or portfolio management or (ii) selling or advising clients in relation to structured deposits have to provide suitable personal recommendations to their clients, in particular to their retail clients, or they have to make suitable investment decisions on behalf of their clients. In order to match clients with suitable investments, Firms should establish policies and procedures to ensure that they consistently take into account: (i) all available information about the client necessary to assess...

  Read more
•  

  31.08.2022

  Ex­ec­ut­ive Re­mu­ner­a­tion and ESG

  Why link executive remuneration with ESG? We have identified five key reasons why UK companies should consider linking executive remuneration with ESG considerations. 1. Disclosure obligations UK-listed companies are well-used to financial reporting and in recent years there has been an increased focus on remuneration-related disclosures with the Companies (Directors’ Remuneration Policy and Directors’ Remuneration Report) Regulations 2019 requiring them to report annually on board remuneration. This increased focus on remuneration-related disclosures has been coupled with an increase...

  Read more
•  

  12.08.2022

  Does the Fin­an­cial Ser­vices and Mar­kets Bill 2022 se­cure the UK’s green fin­ance agenda?

  We consider there is merit in uplifting the drafted principle to be a secondary objective, with the same status of the FSM Bill’s proposed growth and international competitiveness secondary objective, which may: Have greater impetus for the regulators to integrate net zero on a day-to-day basis in their range of activities across rule-making, supervision and enforcement. Ensure the future of the UK regulatory regime has the green agenda embedded in it on a stronger legal footing as an objective, rather than as a principle. Under the FSM Bill, the regulators are intended to have an increasingly...

  Read more