Combating global greenhouse emissions and implementing the transition to net-zero requires unprecedented financial investment. Financial institutions are critical players because of their role in allocating capital and ability to act as a catalyst to achieve better ESG outcomes in society generally.
A number of factors are driving up the incidence of climate related litigation and enforcement which has been most marked in North America but other regions are now catching up. Financial institutions given their critical place in financing economic activity are increasingly the focus of action. Financial institutions are well advised to prepare for and mitigate the risk, for example, from reviewing their corporate strategies around climate change and carbon reduction to taking note of regulators’ expectations.
In this episode of FInsight, we take a look at financial institutions trends fro the global disputes landscape.
With financial services regulation developing at pace in areas such as ESG, Fintech and new technologies, our newly launched horizon scanning tool, the Global Financial Services Regulatory (FSR) Momentum Monitor enables financial service providers to plan and prepare for coming regulatory developments across the jurisdictions in which they operate.
On March 21, 2022, the U.S. Securities and Exchange Commission (SEC or Commission) issued its long-awaited proposed ruleset (Rule Proposal) that, if adopted as currently drafted, would mandate both domestic and foreign registrants to make a variety of climate-related impact and risk disclosures in registration statements and in annual filings under the Securities Exchange Act of 1934 (Exchange Act).
In yet another step forward on the SEC’s path toward a comprehensive ESG disclosure framework, on September 22, 2021, the Staff of the Division of Corporation Finance issued a Sample Letter to Companies on Climate Change Disclosure, relying on the Commission’s 2010 Climate Change Guidance.