Tracking ESG Regulation

ESG Insider Podcast: Standard setters work to close climate accounting gaps

Investors are increasingly calling on companies to reflect climate-related risks in their financial results. In September 2020, global investor groups representing more than $103 trillion wrote an open letter asking companies and their auditors to include climate-related risks in financial reporting.

We interview International Accounting Standards Board (IASB) Vice Chair Sue Lloyd about plans for a new international sustainability standards board.

ESG Insider Podcast: EU Revolutionizes Sustainability Regulation with SFDR

The new Sustainable Finance Disclosure Regulation, or SFDR, is expected to drastically change the scope of sustainable investing by providing greater clarity and transparency and increasing disclosure.

Fund managers will now have to disclose environmental, social and governance risks in their portfolios, marking the first step in a vast EU plan to drive capital to meet sustainable goals.

In the episode we talk to Nathan Fabian, Chairperson of the European Platform on Sustainable Finance and Chief Responsible Investment Officer at the Principles for Responsible Investment, or PRI, a United Nations-backed network of investors.

TCFD Gains Momentum as Climate Reporting Shifts from Voluntary to Mandatory

A big reason why many companies struggle with TCFD implementation is because it's hard to collect, collate and analyze detailed emissions-related data in all areas of their operations. Companies also need to train their employees on technical aspects of reporting under the framework. Above all, TCFD implementation must be roundly embraced and instilled — all the way from the C-suite to product and client-teams — and that takes time.

In this episode, we speak to Thora Frost, senior manager of green finance at the Carbon Trust, a London-based consulting firm that works on climate change and sustainability issues. And we interview Matthew Townsend, partner at U.K. law firm Allen & Overy.

ESG Insider Podcast: New EU Sustainable Finance Rules a ‘Game-Changer' for Private Equity

The European Union’s new SFDR is expected to drastically change the scope of sustainable investing by providing greater transparency and increasing disclosure. And this is a particularly big deal for the private equity world, which has historically relied on self-regulation.

Broadly speaking, private equity refers to investments in or ownership of private companies, and in this episode, we ask how SFDR is impacting the private equity industry. We hear from Sophie Flak, managing partner in charge of ESG at French investment firm Eurazeo. Sophie was a member of an EU expert group that put in place some recommendations on SFDR.

We also talk to Andy Pitts-Tucker, who works closely with private equity firms in his role as managing director of APEX ESG Ratings. He expects that SFDR will require “a significant leap” for a majority of the industry.

What EU's Proposed Green Bond Standards Could Mean for Market

The EU has proposed a European Green Bond Standard as part of its strategy to drive investment into sustainable finance and achieve net zero carbon emissions by 2050. The new rules will also aim to protect investors from greenwashing, which is when an investment is made to sound greener than it is.

Although they represent a tiny fraction of the overall debt market, green bonds — debt that finances environmentally friendly projects such as wind farms or solar power — have grown rapidly over the last eight years, from virtually nothing in 2012 to nearly $300 billion in 2020. The EU is counting on further growth in the market to meet the targets in its European Green Deal, designed to mobilize at least €1 trillion of sustainable investment over the next 10 years. The rules will be tougher than other existing green bond guidelines because issuers will have to prove their green bonds are financing projects in line with the EU's "green taxonomy," a dictionary of sustainable activities.

In this episode, we speak to Climate Bonds Initiative CEO Sean Kidney, who was part of an advisory group that helped shape the new rules.

A Short Guide to the EU’s Taxonomy Regulation

The EU’s new Taxonomy Regulation is designed to support the transformation of the EU economy to meet its European Green Deal objectives, including the 2050 climate-neutrality target. As a classification tool, it seeks to provide clarity for companies, capital markets, and policy makers on which economic activities are sustainable. As a screening tool, it seeks to support investment flows into those activities.

What is the EU Taxonomy?

At over 550 pages (with more to come), the EU Taxonomy can be daunting – even to the initiated. Let’s start with the basics. The Taxonomy is primarily a classification system for economic activities. Like any classification system, it has definitions and rules. The EU Taxonomy’s definitions and rules determine which economic activities are environmentally sustainable.

Top US financial regulator faces big questions in move to mandate ESG disclosures

The U.S. Securities and Exchange Commission is poised to roll out ESG disclosure regulations on climate risk and human capital management. New rules could plug gaps and inconsistencies in data that many investors have identified as a challenge.

But in crafting these regulations, Wall Street’s top regulator will need to tackle several thorny questions: How should the agency address corporate liability concerns? What specific metrics are needed? And to what extent should the SEC harmonize its disclosure rules with existing voluntary and mandatory standards in other parts of the world?

ESG Insider Podcast: Here’s How You Stress Test for Climate Risk, According to France’s Central Bank

In a world first, the French central bank conducted a climate stress test on its financial sector. Listen to this episode of ESG Insider, a podcast hosted by S&P Global Sustainable1, to hear an interview with Laurent Clerc, director for research and risk analysis at the supervisory arm of the French central bank, which conducted the world’s first climate stress tests.

Webinar Replay: How Can ESG Policy and Regulation Unlock Opportunities for Insurers?

Watch this webinar replay as our panel of experts discuss the regulator’s role in driving ESG integration and disclosure that could lead to long-term financial value in insurance portfolios.

Webinar Replay: Getting Practical at Banks & Insurers

Climate change has become an important strategic issue for global financial institutions as concern grows about lending to, investing in, or insuring companies that are failing to take steps to transition to a low-carbon economy. Stress testing aims to address several key areas for banks and insurers, including asset level counterparty modelling and the financial impact on loan and investment portfolios.