Legal & Regulatory News

On 22 December 2023, the first set of the European Sustainability Reporting Standards (ESRS) was published in the Official Journal of the EU. The ESRS will be applicable in all Member States and will apply to companies that come under the Corporate Sustainability Reporting Directive (CSRD).

On 15 December 2023, the European Banking Authority (EBA) published a report (the Report) in response to a call for advice from the European Commission on green loans and green mortgages. Alongside the Report, the EBA also published an opinion on green loans and mortgages.

On 12 December 2023, the European Union Platform on Sustainable Finance released a draft report on a proposal for voluntary EU Taxonomy-Aligning Benchmarks. The call for feedback on the report is open until 13 March 2024.

On 7 December 2023, the European Council and European Parliament provisionally agreed an ambitious proposal to revise the Energy Performance of Buildings Directive (the proposal). This Directive forms part of the European Union’s ‘Fit for 55’ package, which aims to ensure that the policies set by the European Union are aligned with its climate goals, including the goal of reducing EU emissions by at least 55% by 2030.

On 4 December 2023, during a meeting of the Economics and Monetary Affairs Committee (the Committee), Members of the European Parliament voted to amend the regulation proposed by the European Commission on environmental, social and governance (ESG) rating activities. The amendments are intended to increase transparency and competition amongst ratings providers.

On 4 December 2023, the UN-convened Net-Zero Export Credit Agencies Alliance (NZECA) was launched at COP28. NZECA is a first-of-its-kind alliance uniting leading public finance institutions committed to delivering net-zero economies by 2050 by supporting the decarbonisation of trade and facilitating joint action from public and private finance.

On 1 December 2023, the European Council (EC) adopted its negotiating position on the Corporate Sustainability Due Diligence Directive (CSDDD).

On 28 November 2023, the UK Financial Conduct Authority (FCA) published its Policy Statement on Sustainability Disclosure Requirements and investment labels. These rules are intended to ensure that investment products fulfil their description in order to increase trust and the ease of decision making for consumers. In the final publication, the FCA included a new investment label, ‘Sustainability Mixed Goals’ and an anti-greenwashing rule.

On 22 November 2023, the European Securities and Markets Authority (ESMA) published three explanatory notes on the EU’s Sustainable Finance framework. The explanatory notes are intended to increase the ease of access to the EU Sustainable Finance framework and are therefore intended as educational or reference tools, rather than a revision of the key terms included in the EU’s legislation.

On 21 November 2023, the European Commission (EC) published both the European Union Taxonomy Environmental Delegated Act and the Climate Delegated Act (together the Delegated Acts) within the Official Journal of the European Union.

On 17 November, the European Commission published the Energy Efficiency Financial Institutions Group (EEFIG) working group’s final report, ‘Applying the Energy Efficiency First principle in sustainable finance’. The Loan Market Association is delighted to have participated in the EEFIG working group, which has been looking at ways to embed the energy efficiency first principle amongst financial institutions.

On 15 November, a meeting of the Committee of Permanent Representatives in the European Union took place, during which a proposal from the Spanish Presidency on the EU Corporate Sustainability Due Diligence Directive (CS3D) was endorsed. This proposal was seen by members of the press ahead of a council working party meeting on 10 November.

On 25 October 2023, the International Auditing and Assurance Standards Board (IAASB) published answers to frequently asked questions (FAQs) on the application of materiality by a reporting entity and by an assurance practitioner. This guidance was developed in response to feedback that additional clarity was required on the application of materiality in this context.

On 23 October 2023, the European Council adopted a regulation creating a European Green Bond Standard (EUGBS). This regulation is intended to encourage greater alignment in the green bond market and increase the ease of assessment for investors, with the intention of directing more capital towards sustainable activities.  

The International Trade & Forfaiting Association’s ESG Committee has published a report authored by Dr. Rebecca Harding which expands on the challenges of regulatory sustainability reporting in the international banking and trade finance space.  This latest research paper suggests significant divergence in common reporting practice across major trade and supply chain banks.  Whilst regulatory reporting standards are starting to become clearer, the divergence of reporting practice identified in the research suggests that the “how” to comply and “what” to measure is not.    

On 19 October 2023, the UK Government initiated a call for evidence on the benefits, costs and practicalities of Scope 3 greenhouse gas (GHG) emissions reporting in the UK. The Greenhouse Gas Protocol defines Scope 3 GHG emissions as all indirect emissions, not included in Scope 2, that occur in the value chain of the reporting company. Scope 3 is increasingly important for investment decisions, since it enables investors to gain a more comprehensive understanding of climate risks, however, it also increases the burden on companies in terms of data collection and reporting.

On 17 October 2023, the European Commission (EC) published a proposal (the Proposal) to the European Parliament and Council to delay the adoption of sector-specific European Sustainability Reporting Standards (ESRS) and ESRS for non-European companies under the Corporate Sustainability Reporting Directive (CSRD) by two years.

On 11 October 2023, over 40 Members of the European Parliament (MEPs) attempted to block the European Sustainability Reporting Standards (ESRS) Delegated Act through a motion for a Resolution.

On 9 October 2023, the Transition Plan Taskforce (TPT) launched its highly anticipated Final Disclosure Framework and Implementation Guidance. The objective of the framework is to provide a gold standard for transition plans in the UK, encouraging businesses to deliver on their sustainability objectives whilst also managing their climate risks.

On 2 October 2023, the European Securities and Markets Authority (ESMA) published a paper (the paper) entitled, ‘ESG names and claims in the EU funds industry’. The paper provides that funds are increasingly using ESG-related language in their names – reflecting regulatory efforts on disclosure requirements. Within the paper, ESMA also state that “the evolution of ESG language in fund names demonstrates the usefulness of ESMA’s recent public consultation on guidelines to ensure fund names accurately reflect their portfolio from an ESG perspective". ESMA argues that some asset managers have been using Article 8 and 9 of the Sustainable Finance Disclosure Regulation (SFDR) as proxy ESG labels – leading to confusion and raising greenwashing concerns.

On 28 September 2023, the European Supervisory Authorities (ESAs) published their 2023 annual joint report on the extent of voluntary disclosure of principal adverse impacts (PAI) under the Sustainable Finance Disclosure Regulation (SFDR) sustainability‐related disclosures in the financial services sector.

On 20 September 2023, the UK government announced notable changes to their net zero strategy, in a shift away from various policies.

On 19 September 2023, the Glasgow Financial Alliance for Net Zero (GFANZ) launched a consultation seeking market feedback on its work to further refine the definitions of its transition finance strategies and support financial institutions to forecast the impact of these strategies on reducing emissions.

On 18 September 2023, the Taskforce on Nature-Related Financial Disclosures (TNFD) published its final Recommendations (the Recommendations). The TNFD is a market-based initiative which aims to encourage and aid the reporting of nature related risks and opportunities whilst also increasing the consideration by businesses and financial institutions of their impact on nature, nature risks, and the interrelationship between nature and climate.  

On 14 September 2023, the EU Commission launched both a targeted and public consultation on the Sustainable Finance Disclosure Regulation (SFDR). The consultations aim to gather views on the implementation of SFDR and any shortcomings, including the interaction of SFDR with the existing EU framework on sustainable finance.

On 4 September 2023, the Africa Climate Summit (ACS) began – with over 10,000 in attendance.

Two of the significant takeaways from the ACS were: -

• the signing of the Nairobi Declaration; and
• the rising momentum behind a New Global Financing Pact.

On 1 September 2023, the Green Technical Advisory Group (GTAG), who advise the UK government on the design and development of the UK Green Taxonomy, published two new reports.

On 10 August 2023, the Financial Conduct Authority (FCA) published its Primary Market Bulletin 45 – highlighting the FCA’s support for the International Sustainability Standards Board (ISSB) Sustainability Disclosure Standards – IFRS S1 and IFRS S2. The FCA announced plans in 2024 for a consultation on whether to update their Task Force on Climate-related Financial Disclosures (TCFD)-aligned disclosure rules for listed companies to instead refer to the UK-endorsed ISSB standards.

On 2 August 2023, the Green Technical Advisory Group (GTAG) published a report entitled ‘Streamlining and increasing the usability of the Do No Significant Harm (DNSH) criteria within the UK Green Taxonomy’. GTAG is a high-level group which provides advice to the UK government on the development of the UK Green Taxonomy. GTAG began a review into the DNSH criteria after recognising the issues around the subject in relation to the EU Taxonomy.

On 2 August 2023, Slaughter and May published ‘A Borrower’s Guide to Sustainability-Linked Loan Terms’ (the Guide) which was produced for the Association of Corporate Treasurers. The purpose of the Guide is to equip treasurers with an understanding of the parameters of a sustainability-linked loan (SLL) and how those characteristics are protected in facility documentation.

On 2 August 2023, the UK Department for Business and Trade (DBT) released guidance on the UK government’s framework to create UK Sustainability Disclosure Standards (SDS). The SDS will establish sustainability-related corporate disclosure standards on ESG risks and opportunities. Such disclosures are intended to form the basis of future legislation and regulation.

On 2 August, the International Auditing and Assurance Standards Board (IAASB) opened a consultation via the publication of an exposure draft on a ‘Proposed International Standard on Sustainability Assurance‘. The proposed standard is intended to be applied to third parties undertaking assurance reports on sustainability data. The consultation period is set to end on 1 December 2023.

On 31 July 2023, the European Commission (EC) adopted the European Sustainability Reporting Standards (ESRS). 

On 27 July 2023, the Transition Plan Taskforce (TPT) published ‘Building momentum for transition plans’, a status update on its activities. The TPT was established at COP 26 and aims to set out the components of a gold standard transition plan through the publication of a Disclosure Framework.

On 19 July 2023, the UK Sustainability Technical Advisory Committee (TAC) issued a call for evidence in relation to the endorsement by the UK Government of the International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards.

On 18 July 2023, the European Banking Authority (EBA) published its decision dated 6 July 2023 concerning the ad hoc collection of institutions’ ESG data by competent authorities.

On 12 July 2023, the European Parliament adopted its position on the EU nature restoration law, with 336 votes in favour, 300 against and 13 abstentions. The proposed law is intended to contribute to the fulfilment of the EU Biodiversity Strategy for 2030 by requiring Member States to achieve established targets for nature restoration.

On 6 July 2023, the Financial Stability Board (FSB) Plenary met in Frankfurt. The Plenary discussed various key issues, including the FSB’s progress on addressing financial risks stemming from climate change and its upcoming deliverables to the G20.

On 5 July 2023, the ESG Data and Ratings Working Group (DRWG), alongside the International Regulatory Strategy Group and the International Capital Market Association, published a consultation on a draft voluntary code of conduct for ESG ratings and data product providers (the Code of Conduct).  The consultation closes on 5 October 2023.

The FCA recently undertook an investigation to better understand the functioning of the SLL market. As part of this process, the FCA engaged with stakeholders to gather SLL market intelligence; determine what measures might improve the market integrity of the SLL product; and understand where the FCA might be able to encourage further development of the SLL market as an important transition financing tool.

On 26 June 2023, the International Sustainability Standards Board (ISSB) of the International Financial Reporting Standards Foundation (IFRS) published two disclosure standards, IFRS S1 and IFRS S2. The ISSB hopes that the standards will enable more transparent communication between companies and investors.

On 22 June 2023, at the Summit for a New Global Financing Pact in Paris, the UK Minister for Development and Africa, Andrew Mitchell, announced that UK Export Finance (UKEF) had entered into discussions with twelve partner countries in the Caribbean and Africa with a view to adding ‘Climate Resilient Debt Clauses’ (CRDCs) to new and existing loan agreements.

On 15 June 2023, the Science Based Target Initiative (SBTi) released three draft resources for the financial sector for consultation, ending 14 August 2023.

On 14 June 2023, the UN opened a new reporting window for signatories on the PRI – set to close on 6 September 2023. The PRI has also published accompanying 2023 Reporting Framework guides.

On 9 June 2023, the European Commission published a revised draft of the European Sustainability Reporting Standards (ESRS), being the reporting standards being introduced under the EU’s Corporate Sustainability Reporting Directive, inviting feedback to be provided on or before 7 July 2023.

On 9 June 2023, the European Union published regulation on deforestation which emphasises the impact of deforestation on the climate crisis, greenhouse gas emissions and biodiversity loss and which aims to diminish the Union’s contribution to all three.

On 1 June 2023, the European Supervisory Authorities (ESAs), including the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA) published the following reports on greenwashing in the financial services sector following the European Commission’s request for input related to greenwashing risks and the supervision of sustainable finance policies.

On 1 June 2023, the European Parliament (EP) adopted its its position for negotiations with member states on rules to integrate human rights and environmental impact into companies’ governance in the Corporate Sustainability Due Diligence Directive (CSDDD). The directive pushes EU companies to identify, prevent, and mitigate their negative impacts on human rights and the environment.

On 31 May 2023, the Network for Greening the Financial System (NGFS) published a report, exploring the relevance and extent to which financial institutions’ transition plans relate to microprudential authorities’ roles and mandates and whether they should be considered within their supervisory toolkit and in the overall prudential framework. 

On 25 May 2023, the three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) have jointly submitted to the European Commission Draft Regulatory Technical Standards (RTS) on the ESG impact disclosure for Simple, Transparent and Standardised (STS) securitisations under the Securitisation Regulation (SECR).  These final draft RTS aim to help market participants make informed decisions about the sustainability impact of their investments.

On 12 May 2023, the High Court refused CE's application for permission on the papers presented on the basis that CE had failed to establish the prima facie case required to warrant the grant of permission under section 261(1) of the CA 2006 for it to continue a derivative claim against Shell's directors.

On 20 April 2023, the following minor amendments were made to the below documents:

Sustainability-Linked Loan Principles (SLLP)

SLLP Guidance

Green Loan Principles (GLP) Guidance

Social Loan Principles (SLP) Guidance

On 14 April 2023, the European Commission published an internal Commission Decision (C(2023) 2281 final) (the Decision), on questions relating to the application of the Sustainable Finance Disclosure Regulation ((EU) 2019/2088) (SFDR) which were submitted by the European Supervisory Authorities (ESAs). Annex 1 to the Decision outlines the Commission's new answers to the questions submitted by the ESAs and Annex 2 outlines updated answers.

On 12 April 2023, the European Supervisory Authorities (ESAs) published a joint consultation paper (the Consultation) seeking feedback on significant changes to the Sustainable Finance Disclosure Regulation (SFDR) regulatory technical standards.

On 11 April 2023, the UK Financial Conduct Authority (FCA) published a press release announcing the launch by the Global Financial Innovation Network (GFiN) of its first 'Greenwashing TechSprint' (the TechSprint) hosted by the FCA's Digital Sandbox. The purpose of the TechSprint is to develop tools and solutions that may assist regulators and the market in tackling the risks of greenwashing in financial services, and to ensure that consumers have access to sustainable finance products and services that adequately suit their needs.

On 3 April 2023, it was announced that member countries of the Organisation for Economic Cooperation and Development (OECD) agreed in principle on an EU initiative to modernise export credit rules to better support the green transition. This follows several years of negotiation.

We are delighted to share the second in a series of two guidance notes, summarising the changes made in the recent updates to the Green Loan Principles (GLP), Social Loan Principles (SLP) and Sustainability-Linked Loan Principles. In this note, we share a non-exhaustive summary of the changes made to the GLP and SLP as well as their accompanying guidance documents.

On 28 March 2023, the Financial Services Regulatory Authority of Abu Dhabi Global Market (FSRA) alongside members of the UAE Sustainable Finance Working Group issued its draft 'Principles for the Effective Management of Climate-Related Financial Risks' (the Principles) for consultation.

Following the release of the updated Green Loan Principles, Social Loan Principles and Sustainability-Linked Loan Principles (SLLP) at the end February, we (the LMA) are pleased to share the first of two guidance notes summarising the main changes made.

In this first note, we are pleased to provide a non-exhaustive summary of the amends to the Guidance on SLLPs. A similar summary of the Green Loan Principles and Social Loan Principles (and related Guidance) will follow in a subsequent alert.

On 28 February 2023, the UK Competitions and Market Authority (CMA) published a draft guidance (the Guidance) document for UK corporates wishing to collaborate on environmental sustainability with industry peers without fear of breaching existing competition laws.

On 28 February 2023, the European Parliament and the European Council reached a provisional agreement on the introduction of the European Green Bond Standard (EU GBS).

The EU GBS will be a voluntary standard to help scale up and raise the environmental ambition of the EU green bond market. 

On 23 February 2023, the UK's Green Technical Advisory Group (the GTAG), a group of leading financial industry experts advising the UK Government on the design and implementation of a UK green taxonomy, released a report looking at promoting the interoperability of any future UK green taxonomy.

On 17 February 2023, the European Banking Federation (EBF) published its proposals on a transition finance framework at an EU level (the Framework).

The EBF notes that common transition plan structures may help to encourage the development of new financial products by banks and may enable and incentivise the financing of companies that require capital to improve the environmental performance of their activities.

On 17 February 2023, Commission Delegated Regulation (EU) 2023/363 (the Delegated Regulation), which amends and corrects certain regulatory technical standards (RTS) in relation to the Sustainable Finance Disclosure Regulation (SFDR), was published in the Official Journal of the European Union.

On 17 February 2023, at a meeting in Montreal, the International Sustainability Standards Board (ISSB) agreed that its initial IFRS Sustainability Disclosure Standards, S1 and S2, will become effective starting January 2024. Given that sustainability disclosure is new for many companies globally, the ISSB will introduce programmes that support those applying its Standards as market infrastructure and capacity is built.

On 16 February 2023, the United Nations Environment Programme Finance Initiative (UNEP FI) published a press release regarding its intention to strengthen the climate ambition of its Principles for Responsible Banking (the Principles).

On 13 February 2023, the European Banking Authority (EBA) launched an industry survey to obtain input from credit institutions on their green loans and mortgages as well as to understand current market practices relating to these loans.

On 10 February 2023, the UK Financial Conduct Authority (FCA) released a Discussion Paper (DP23/1) (the DP) on how FCA regulated firms' governance, incentives and competence can ensure the financial industry plays a leading role in enabling an economy-wide transition to net zero.

The release of the DP also coincided with the FCA's Director of Environmental, Social and Governance, Sacha Sadan, publishing a blog post, looking directly at this area and encouraging all stakeholders to close the "say-do" gap to catalyse commitments into real actions.

On 9 February 2023, the European Parliament's (the Parliament) Environment Committee voted in favour of tightening the requirements under the draft Corporate Sustainability Due Diligence Directive (CSDDD).

In February 2023, the International Chamber of Commerce (ICC) released a progress report (the Progress Report) assessing the extent to which the export finance industry has adopted the recommendations on sustainability outlined in an ICC white paper first published on 22 September 2021 (the White Paper).

On 1 February 2023, the European Commission (the Commission) released its Green Deal Industrial Plan (the Plan) as part of its strategy to ensure that the European Union becomes a competitive green technology leader and can meet its binding commitment to become net zero by 2050.

The Plan sets out the EU's strategy for the scaling up of  EU green technology manufacturing, and is intended to work alongside the Commission's overarching European Green Deal.

On 31 January 2023, the World Wildlife Fund for Nature (WWF) published a paper looking at how and why companies should consider climate and nature together when they are drafting transition plans (the Paper).

The WWF notes that, whilst there has been increasing interest and activity in the drafting of transition plans across much of the real economy, a large majority of their focus has been on climate action and has undervalued the protection of the natural world.

On 31 January 2023, the Organisation for Economic Co-operation and Development (OECD) released a report (the Report) looking at how to remove barriers in the development of the sustainable infrastructure financing market.

On 31 January 2023, the European Central Bank (ECB) issued a staff opinion (the Opinion) supporting the draft proposals on the European Sustainability Reporting Standards (ESRS).

On 24 January 2023, Sarah Cardell, Chief Executive of the UK's Competition and Markets Authority (CMA), announced plans to ease antitrust rules in order to ensure that competition laws do not inhibit companies' ability to share knowledge and come together to develop environmentally sustainable initiatives.

On 18 January 2023, the Science Based Target Initiative (SBTi) published a guidance document (the Guidance), which is intended to support financial institutions through the process of committing to and implementing the Taskforce on Climate-related Financial Disclosures (TCFD) and the SBTi financial institution (SBTi-FI) frameworks. The Guidance details the overlaps between these frameworks and further describes the harmonisation inherent in setting credible science-based targets and preparing robust climate-related risk and opportunity disclosures.

On 17 January 2023, the University of Cambridge Institute for Sustainability Leadership, the Business for Social Responsibility, the We Mean Business Coalition and the SME Climate Hub published a report (the Report) looking at the role of banks and multi-national corporations in addressing the barriers for small and medium sized businesses (SMEs) looking to transition to net zero.

On 13 January 2023, former energy secretary Chris Skidmore MP published his net zero review (the Review), outlining the opportunities offered by net zero transition.

The aim of the Review was to provide a comprehensive review of the UK's current net zero strategy (NZS), following the 2022 High Court judgment, which concluded that the UK Government's NZS was "unlawful" and "inadequate", and ordered that the NZS be reissued by the end of March 2023.

In the case of R (Friends of the Earth Ltd) v Secretary of State for International Trade (UK Export Finance), the UK Court of Appeal considered the way in which the UK Government should take into account the UK's climate change commitments under the Paris Agreement when deciding whether to finance overseas projects.

On 10 January 2023, the European Commission released a summary report of the responses received to its consultation on the regime applicable to the use of benchmarks administered in a third country under the EU Benchmarks Regulation. 

On 19 December 2022, the United Nations Biodiversity Conference in Montreal (known as COP15) concluded with a landmark agreement to guide global action on protecting the natural world through to 2030.

On 14 December 2022, the UK Government released a statement made by Andrew Griffith (the Secretary), the Economic Secretary to HM Treasury and Co-chair of the UK's Transition Plan Taskforce, regarding the development of a UK Green Taxonomy.

On 13 December 2022, the Financial Conduction Authority's Climate Financial Risk Forum (CFRF), representing a diverse range of financial institutions including UK-regulated banks, insurers, asset managers, asset owners and public/private organisations, published its third round of guides to help the financial sector develop its approach to addressing climate-related financial risks and opportunities.

On 13 December 2022, the European Banking Authority (EBA) published its three year roadmap on sustainable finance (the Roadmap), outlining the objectives and timeline for delivering mandates in the area of sustainable finance and environmental, social and governance (ESG) risks.

On 8 December 2022, the Basel Committee on Banking Supervision (BCBS) published a frequently asked questions document (the Document), identifying climate-related financial risks.

The Document was developed to provide clarification on how climate-related financial risks could be captured in the BCBS' Pillar 1 standards.

On 5 December 2022, the European Parliament published a speech given by Mairead McGuinness, the European Commissioner for Financial Services, Financial Stability and Capital Markets Union (the Commissioner), setting out details of current sustainable finance initiates being conducted in the EU.

On 30 November 2022, the European Commission adopted Implementation Regulation (EU) 2021/637 (the Regulation), amending the implementing technical standards (ITS) for the disclosure of environmental, social and governance risks under the Capital Requirements Regulation (CRR).

On 28 November 2022, the EU Platform on Sustainable Finance (the Platform) published a report (the Report) on the methodology and technical screening criteria for environmental activities covered in the EU Taxonomy (EU 2020/852).

The Report supplements an initial report published in March 2022, providing an update on the Platform's work, as well as a number of new recommended methodology frameworks for Taxonomy enabled activities and technical screening criteria for sector specific activities.

On 28 November 2022, the Council of the European Union (the Council) gave its final approval and adopted the corporate sustainability reporting directive (CSRD).

CSRD introduces more detailed reporting requirements on companies, with an aim of increasing accountability, preventing divergent sustainability standards, and easing the transition to a sustainable economy.

On 22 November 2022, the European Commission (the Commission) issued a request for advice from the European Banking Authority (EBA) on the European green loan and mortgages market in order for the Commission to consider measures to encourage the development of these markets.

The scope of the request for advice covers various green loans originated by credit institutions in the EU, including loans with environmental sustainability features, green mortgages and, where applicable, loans based on the EU Taxonomy and its six environmental objectives.

On 22 November 2022, the Financial Conduct Authority (FCA) announced the formation of a new Working Group to develop a UK specific voluntary Code of Conduct for Environmental, Social and Governance (ESG) data and ratings providers. 

On 15 November 2022, the European Supervisory Authorities (ESAs) – the European Banking Authority, the European Insurance and Occupational Pensions Authority and the European Securities and Markets Authority –  issued a joint call for evidence on potential greenwashing practices in the EU financial sector.

On 15 November 2022, the Financial Stability Board (FSB) and the Network for Greening the Financial System (NGFS) published a joint report entitled, 'Climate Scenario Analysis by Jurisdictions: Initial findings and lessons' (the Report).

The Report highlights the findings from a joint survey conducted by the FSB and the NGFS, including analysing the current status of climate scenario analysis, the main purpose of the scenario exercises and the main uses of the scenario analysis results.

On 9 November 2022, the Coalition for UK Net Zero Carbon Buildings Standard (NZCBS) launched a Call for Evidence for UK built environment industry practitioners to share embodied carbon and in-use operational energy performance data for their buildings.

NZCBS consists of a number of key market stakeholders, including the Royal Institute of British Architects, the Carbon Trust and the Royal Institution of Chartered Surveyors. NZCBS intends to develop a standard that will set out metrics by which net zero carbon performance is evaluated, creating a single market methodology, as well as performance targets and limits that need to be met.

On 9 November 2022, the International Organization for Securities Commissions (IOSCO) launched a consolation paper (the Consultation) which sets out its recommendations on establishing a credible and well-functioning compliance carbon market (CCMs). In addition, IOSCO launched a discussion paper (the Paper) seeking industry views on the role of financial market regulators in voluntary carbon markets (VCMs).

On 8 November 2022, the UK's Transition Plan Taskforce (TPT) published a consultation (the Consultation) on their disclosure framework (the Framework) and an accompanying implementation guide (the Guide) in relation to the proposed introduction of a UK specific disclosure framework for private sector climate transition plans.

The Consultation is part of the TPT's mandate to provide recommendations to inform the UK's regulatory requirements on transition plan disclosures with the aim of developing consistent, robust and credible transition plans.

On 4 November 2022, the Taskforce on Nature-related Financial Disclosures (TNFD) published a consultation on the third iteration of their beta Nature-related Risk and Opportunity Management and Disclosure Framework (the Framework).

The release of the Framework follows the first and second iterations of the TNFD's beta framework in March 2022 and June 2022 respectively, with the aim of supporting a shift in global financial flows away from nature-negative outcomes and toward nature-positive outcomes. The Framework now includes some substantial changes following prior consultations with the TNFD's Working Groups and the wider market participants, including the introduction for the first time of the TNFD's recommended approach to disclosures of dependencies and impacts on nature.

On 1 November 2022, the Glasgow Financial Alliance for Net Zero (GFANZ) published their final report on 'Financial Institution Net-zero Transition Plans' (the Report), with the aim of accelerating adoption of current best practices and promoting consistency in the development and use of transition plans across the financial sector.

On 31 October 2022, the European Commission adopted a Delegated Regulation (EU) 2022/1288 adopting regulatory technical standards (RTS) under the Sustainable Finance Disclosure Regulation (SFDR) to require financial market participants to also disclose, by way of a simple graph, the extent to which their portfolios are exposed to the gas and nuclear-related activites that comply with the Taxonomy.

On 25 October 2022, the UK Financial Conduct Authority (FCA) published a consultation paper (CP22/20) (the Consultation) on the introduction of sustainability disclosure requirements (SDR) and investment labels.

The FCA's proposals set out in the Consultation include the introduction of a number of measures aimed at preventing greenwashing.

On 24 October 2022, the European Banking Authority (EBA) published a report (EBA/REP/2022/26) on incorporating environmental, social and governance (ESG) risks into the supervision of investment firms (the Report).

In the Report, the EBA suggests that there is a need for the integration of ESG factors and risks under all the main Supervisory Review and Evaluation Process elements, including: business model analysis; assessment of internal governance and risk management; and assessment of capital and liquidity risks.

On 21 October 2022, the UK's Prudential Regulation Authority (PRA) and the Bank of England (BoE) released a Dear CEO letter (the Letter) on the thematic feedback on the PRA's supervision of climate-related financial risk and the BoE's Climate Biennial Exploratory Scenario exercise.

The Letter highlights the expectation that firms' financial reporting-related priorities should include enhancing their climate-related data, scenario analysis, modelling capabilities, governance and control.

On 17 October 2022, the European Banking Authority (EBA) published an opinion paper (the Opinion) on the European Commission's amendments to the final draft Implementing Technical Standards (ITS) on prudential disclosures on environmental, social and governance (ESG) risks under Article 449a of Regulation (EU) 575/2013 (the Capital Requirements Regulation (CRR)). The EBA has been mandated to develop the draft ITS on this topic.

On 13 October 2022, the Task Force on Climate-related Financial Disclosures (TCFD) published their fifth annual 2022 Status Report (the Report), reflecting on the milestones in relation to the implementation of their recommendations and other developments in climate-related disclosures.

On 13 October 2022, the Financial Stability Board (FSB) published their final report on 'Supervisory and Regulatory Approaches to Climate-related risks' (the Report). The Report aims to assist supervisory and regulatory authorities in developing their approaches to monitoring, managing and mitigating risks arising from climate change, as well as promoting consistent approaches across sectors and jurisdictions.

On 11 October 2022, the EU Platform on Sustainable Finance (the Platform) published a report (the Report) on their recommendations on data and the usability of the EU Taxonomy.

On 11 October 2022, the EU Platform on Sustainable Finance (the Platform) published their final report advising on the application of minimum safeguards for human rights to be included in the EU Taxonomy (the Report), Articles 3 and 18.

When looking at how to embed minimum standards into EU legislation, the Platform focussed on the Sustainable Finance Disclosure Regulation, the Corporate Sustainability Reporting Directive (CSRD), and the upcoming Corporate Sustainability Due Diligence Directive (CSDDD). The Report identifies four core topics for which compliance with minimum standards should be defined, namely: human rights, including workers' rights; bribery and corruption; taxation; and fair competition.

On 7 October 2022, the UK's Green Technical Advisory Group (GTAG), chaired by the Green Finance Institute, published part one of their advice to the UK Government on the development of a UK green taxonomy (the Report).

GTAG was established in 2021 to provide independent advice to the UK Government on implementing a green taxonomy, including how the UK can build upon existing taxonomies, such as the EU Taxonomy.

On 3 October 2022, the OECD published guidance entitled "Transition Finance: Ensuring Credibility of Corporate Climate Transition Plans," (the Guide) to aid corporate transition planning, with a particular emphasis on transition plans for hard-to-abate industries that will be critical in achieving the Paris Agreement goals.

The OECD note the key role that financial institutions and products will pay in any successful transition. The Guide therefore states that transition finance must be grounded in "credible" transition plans.

On 30 September 2022, the European Supervisory Authorities (ESAs) – comprised of the European Securities and Markets Authority, the European Banking Authority, and the European Insurance and Occupational Pensions Authority – published a final report on the draft Regulatory Technical Standards (RTS) for fossil gas and nuclear energy activities under the Sustainability Finance Disclosure Regulation (SFDR).

On 26 September 2022, the European Securities and Market Authority (ESMA) published its updated timeline for the implementation of key European sustainable finance regulations. This regulatory timeline includes the key implementation milestones for sustainable finance regulations across Europe.

On 20 September 2022, the International Energy Agency (IEA) published their "Breakthrough Agenda Report 2022" on the urgent priorities necessary for producing more affordable clean technologies that will be key to reaching the UN's Net Zero targets.

The report follows the commitments made by 45 countries at the COP26 conference in 2021, in which they committed to making clean technologies the most affordable, accessible and attractive option in each major greenhouse gas emitting sector by 2030. This was classed as the 'Breakthrough Agenda', and the IEA hopes that this report will start a productive dialogue between countries to meet these commitments.

On the 13 September 2022, the European Central Bank (ECB) released a paper examining how credit risk agencies incorporate climate change risk in credit ratings, and how they disclose climate change risk to stakeholders. 

The ECB developed an analytical framework to compare ratings agencies' differing definitions, methodologies, assessment models, data usage, and disclosure practices.

On the 13 September 2022, the European Parliament voted in favour of a new law that would make it obligatory for companies to verify that certain goods sold in the EU have not been produced on deforested or degraded land anywhere in the world. The new law has been proposed following a study that found that between 1990 and 2020, the world has lost 420 million hectares of forest - an area that is larger than the entire European Union.

On 13 September 2022, the European Supervisory Authorities (ESAs) – comprised of the European Securities and Markets Authority, the European Banking Authority, and the European Insurance and Occupational Pensions Authority – published an additional eight questions to the European Commission (the Commission) in order to seek to clarify certain aspects of the Sustainable Finance Disclosure Regulation (SFDR).

On the 7 September 2022, the Network for Greening the Financial System (NGFS) published the third iteration of its climate scenarios for central banks and supervisors (the NGFS Scenarios).

On the 6 September 2022, the European Commission published a Staff Working Document (the Working Document) evaluating the progress towards the targets set in the EU Biodiversity Strategy 2020 (the Strategy).  

The Strategy provided a policy framework that was implemented between 2011-20, with the overall aim of halting the loss of biodiversity and ecosystem services in the EU.  The evaluation of the Strategy's effectiveness was made against the original targets, and using the EU's Better Regulation Guidelines.

On 5 September 2022, the German Financial Supervisory Authority (BaFin) published a Q&A document to provide clarification on how market participants should interpret aspects of the Sustainable Finance Disclosure Regulation (SFDR).

In a briefing paper published on 30 August 2022, the European Parliamentary Research Service has explored the role of central banks, including the European Central Bank (ECB),  in the transition to net zero.  

This briefing paper explores the actions which the ECB announced under its climate action plan and compares them to the actions taken by two of its central bank peers: the US Federal Reserve System and the Bank of England.

On 24 August 2022, the UK Financial Conduct Authority (FCA) published an announcement regarding the launch of their new diversity, equality and inclusion (DEI) initiative. This is aimed at creating closer alignment between new DEI financial products and the FCA's work on improving financial inclusion for underserved or unrepresented consumers.

On 23 August 2022, the Financial Conduct Authority (FCA) announced that it will establish a new advisory committee (the Committee) to focus on ESG issues. The FCA also requested for interested stakeholders to express their interest in joining the Committee.

On the 22 August 2022, the Board of the International Organization of Securities Commissions (IOSCO) published a report titled, 'Retail Investor Education in the Context of Sustainable Finance Markets and Products' (the Report).

The Report was commissioned in response to market investors increasingly seeking out sustainable investments and products with the aim of achieving greater financial returns and/or avoiding risks associated with various environmental, social and governance issues. IOSCO is seeking to ensure that the sustainability claims made about financial investments are accurate and that the integrity of the products are upheld.

On 9 August 2022, the Glasgow Financial Alliance for Net Zero (the GFANZ) launched a public consultation on its draft report, "Measuring Portfolio Alignment: Enhancement, Convergence and Adoption".

The draft report sets out additional guidance for financial institutions on implementing and selecting portfolio alignment metrics in relation to the goal of net zero. The GFANZ workstream on portfolio alignment measurement is intended to promote convergence on methodological best practices on how financial institutions measure their progress towards meeting net zero commitments.

On 9 August 2022, the UK Financial Conduct Authority (FCA) released a copy of a letter (the Dear CEO Letter) sent to all CEOs in its 'Alternatives' portfolio (i.e. FCA authorised firms that predominantly manage alternative investment vehicles (i.e., hedge funds or private equity funds) or manage and advise alternatives assets directly) reaffirming their supervisory priorities for the sector.

On 8 August 2022, the European Securities and Markets Authority (ESMA) released its response to the European Financial Reporting Advisory Group's (EFRAG) public consultation on the first set of draft European Sustainability Reporting Standards (ESRS). The ESRS will eventually form a critical component of the European Commissions' proposal for a Corporate Sustainability Reporting Directive (CSRD) in which companies that fall within scope will be required to publicly report certain environmental and social information pertaining to their business activity.

On 3 August 2022, the UN Principles for Responsible Investment (PRI) published a briefing paper (the Paper) on trends in ESG reporting requirements for investors, which is intended to aid market participants in navigating the ESG reporting requirements applicable to investments and investment processes across Europe, North America and Asia-Pacific.

On 29 July 2022, Luxembourg's Commission de Surveillance du Secteur Financier (CSSF) published a press release regarding the entry into force of the Commission Delegated Regulation (EU) 2022/1288 of 6 April 2022 relating to sustainability-related disclosure requirements in the financial services sector (SFDR) and specifically the new Level 2 regulatory technical standards (SFDR RTS).

On 25 July 2022, Commission Delegated Regulation ((EU) 2022/1288) (the Delegated Regulation), which sets out regulatory technical standards (RTS) relating to the content and presentation of certain disclosures under the Sustainable Finance Disclosure Regulation, was published in the Official Journal of the European Union (OJEU).

On the 22 July, the Equator Principles Association (EPA) has published a guidance note with associated templates to support the effective and consistent application of the Equator Principles.

On 20 July 2022, the Financial Markets Standards Board published a spotlight review on external ESG issuer rating methodologies for companies produced by third party commercial ESG rating providers.

On 18 July 2022, the UK High Court ruled that the UK Government's Net Zero Strategy (NZS) was in breach of its obligations under sections 13 and 14 of the Climate Change Act 2008.

On 15 July 2022, Commission Delegated Regulation ((EU) 2022/1214) (the Taxonomy Delegated Act) supplementing the Taxonomy Regulation ((EU) 2020/852)) was published in the Official Journal of the European Union.

On 8 July 2022, the results of the European Central Bank (ECB) climate risk stress test were published together with an accompanying FAQ document. According to the ECB, the results show that banks do not yet sufficiently incorporate climate risk into their stress-testing frameworks and internal models, despite some progress having been made since 2020.

On 11 July 2022, the Platform on Sustainable Finance published its draft report (the Report) on the application of minimum human rights safeguards in relation to the Taxonomy Regulation ((EU) 2020/852).

On 6 July 2022, MEP's did not reach the majority of votes required to ratify a joint motion to object to the European Commissions' inclusion of gas and nuclear activities in the Taxonomy Delegated Act ((EU) 2021/2139).

The initial motion was proposed jointly by the Economic and Monetary Affairs Committee and the Environment, Public Health and Food Safety Committee on the 14 June 2022, seeking to object to the Commissions' conclusion that both activities were environmentally sustainable.

On 30 June 2022, the Grantham Research Institute (the GRI) at the London School of Economics published their long-awaited annual report on, ‘Global trends in climate change litigation – 2022 snapshot.’

The report includes an analysis of recent global trends in climate change litigation from May 2021-2022, drawing on direct case studies to identify current trends and to predict future increases in climate change litigation.

On 28 June 2022, the Taskforce on Nature-related Financial Disclosures (TNFD) released version 0.2 of its beta framework for nature-related risk and opportunity management and disclosure. This release builds on the first iteration released in March and features TNFD’s approach to metrics and additional guidance for market participants to start pilot testing. Ongoing market feedback will support the further design and development of the TNFD recommendations due in September 2023.

On 28 June 2022, the Principles for Responsible Investment (PRI) published an ESG factor map (the Map) which is designed to facilitate collaboration between sponsors, co-investors and lenders.The Map provides for information obtained from portfolio companies to be shared with co-investors and lenders pre-investment, while at the same time aiming to consolidate ESG-related expectations and requests.

The Climate Financial Risk Forum (CFRF) has developed a beta version of its online climate scenario analysis narrative tool to support smaller firms in assessing their climate-related risks and opportunities. The tool generates a summary narrative description of climate-related risks and opportunities for firms based on a set of pre-selected inputs (e.g., business activities models, products, risks of the firm).

On 22 June 2022, the European Commission announced its proposal to introduce a new Nature Restoration Law (the Proposal) to restore the EU's natural ecosystems. The Proposal is intended to complement the EU's already established 2030 Biodiversity Strategy, which sets out a long-term plan to protect nature and reverse the degradation of ecosystems.

The Proposal promotes the importance of increasing biodiversity in our natural world, emphasising the need to build Europe's resilience to the increasing threat of natural disasters. The Proposal suggests the setting of specific ecological targets, with the overarching objective of the long-term recovery of nature in the EU's land and marine areas.

On 21 June 2022, the Council and European Parliament reached a provisional agreement on the Corporate Sustainability Reporting Directive (CSRD).

The CSRD proposal aims to address shortcomings in the existing rules on disclosure of non-financial information, which are seen to be of insufficient quality to allow such information to be properly taken into account by investors.

The Basel Committee on Banking Supervision (BCBS) has published principles for the effective management and supervision of climate-related financial risks, following a consultation launched in November 2021.

On 15 June 2022, the Glasgow Financial Alliance for Net Zero (GFANZ) released its draft Net-zero Transition Plans (NZTP) for financial institutions. Within this draft framework, GFANZ have sought to specify the necessary steps that financial institutions should take to meet the 2050 net zero greenhouse gas emissions targets set by the UN Race to Zero campaign.

On 14 June, the Economic and Monetary Affairs Committee and the Environment, Public Health and Food Safety Committee adopted a draft objection to the European Commission's proposal to list nuclear and natural gas economic activities as environmentally sustainable.

On 13 June 2022, the Climate Finance Accelerator (CFA) published its summary findings and recommendations to improve liquidity in the climate finance chain. The publication provides tangible guidance on where resources should be focused in order to accelerate financing for climate mitigation to create a more sustainable future.

On 7 June 2022, the European Parliament's Committee on Economic and Monetary Affairs (ECON) published its report on the EU's proposed Green Bond Standard (GBS), suggesting a number of amendments, including:-.

On 31 May 2022, the European Securities and Markets Authority (ESMA) published a supervisory briefing which sets out guidance on the supervision of the integration of sustainability risks and disclosures in the asset management industry (ESMA34-45-1427) (the Briefing).

On 30 May 2022, the UK's Environmental Audit Committee (EAC) launched a call for evidence (Call for Evidence) regarding the role of the financial sector in the UK's net zero transition.

On 25 May 2022, the European Securities and Markets Authority (ESMA) published a set of answers to questions on the Sustainable Finance Disclosure Regulation ((EU) 2019/2088)(SFDR) and the Taxonomy Regulation ((EU) 2020/852). The answers were produced by the European Commission and form Commission Decision (C(2022) 3051), adopted on 13 May 2022 (the Commission Decision).

On 25 May 2022, Sam Woods of the Prudential Regulation Authority (the PRA) gave a speech on capital requirements and climate change. In this speech, Woods noted that the PRA maintains the view that capital is not the best tool to directly address the causes of climate change, for example subsidising green assets by reducing capital requirements or increasing them to penalise carbon-intensive ones.

On 24 May 2022, the Bank of England (BoE) published the results from its 2021 Climate Biennial Exploratory Scenario (CBES), highlighting that UK banks and insurers need to do much more to understand and manage their exposure to climate risk.

On 23 May 2022, the European Central Bank released a publication covering the relevance of climate-related risks to financial stability as part of its May 2022 Financial Stability Report.

On 12 May 2022, the UK Government launched a call for evidence (the Call for Evidence) seeking views and evidence from various stakeholders to support the development of an update to the UK's Green Finance Strategy (the GFS).

On 10 May 2022, the UK's Transition Plan Taskforce (the Taskforce) published a call for evidence on its proposed sector-neutral framework for private-sector transition plans (the Call for Evidence). This comes as many firms are beginning to publish their plans to get to net zero, highlighting the variability, quality and robustness of the plans.

On 9 May 2022, the UK Government's Department for Environment, Food and Rural Affairs (DEFRA) pushed back the closing date of its consultation on environmental targets for England from 11 May 2022 to 27 June 2022.

On 6 May 2022, the European Securities and Markets Authority published two letters from the European Commission (the Commission) to the European Supervisory Authorities (ESAs).

On 2 May 2022, the Joint Committee of the European Supervisory Authorities (the ESAs) launched a consultation paper seeking input on draft Regulatory Technical Standards (RTS) in respect of the sustainability indicators for Simple, Transparent and Standardised (STS) securitisations.

On 2 May 2022, the European Banking Authority (EBA) published a discussion paper covering the role of environmental risks in the prudential framework.

The discussion paper evaluates the appropriateness of the current prudential framework in addressing environmental risk drivers, and considers the potential justification for a dedicated prudential treatment of exposures associated with environment and/or social objectives, and those subject to environment and/or social impacts.

On 27 April 2022, the Network for Greening the Financial System (the NGFS) published a report on 'Enhancing Market Transparency in Green and Transition Finance' (the Report). The main areas explored in the Report are taxonomies; green external review and assessment; and climate transition metrics, frameworks and market products.

On 27 April 2022, The European Central Bank (the ECB) published an opinion statement on the EU Commission's proposed amendments to the Capital Requirements Directive (CRD 6) regarding supervisory powers, sanctions, third-country branches and ESG risk.

On 25 April 2022, UK HM Treasury launched the UK Transition Plan Taskforce (TPT) with a two-year mandate to develop a gold standard for climate transition plans. These climate transition plans, also known as 'net zero transition plans', will be required to be published by certain financial and listed institutions from 2023 as part of the UK Government's proposed 'Sustainability Disclosure Requirements'.

On 13 April 2022, EU permanent representatives greenlighted the position of the European Council (the Council) on the proposed creation of 'European Green Bonds'.

On 6 April 2022, the European Commission (the Commission) formally adopted a delegated regulation containing regulatory technical standards for disclosures of sustainability-related information under the Sustainable Finance Disclosure Regulation (SFDR) (the Delegated Regulation).

On 4 April 2022, the Intergovernmental Panel on Climate Change (the IPCC) published the third part of the IPCC's Sixth Assessment Report, 'Climate Change 2022: Mitigation of Climate Change report' (the Report).

On 4 April 2022, the European Commission (the Commission) launched a targeted consultation on ESG ratings and sustainability factors in credit ratings entitled, 'Functioning of the ESG ratings market in the European Union and on consideration of ESG factors in credit ratings' (the Consultation).

On 31 March 2022, the newly formed International Sustainability Standards Board (the ISSB) launched a consultation on the exposure drafts of its first two proposed sustainability disclosure standards. The first of these standards focuses on general sustainability-related disclosure requirements, whilst the second focuses specifically on climate-related disclosure requirements.

On 30 March 2022, the Platform on Sustainable Finance (the Platform) published a report on the potential extension of the EU Taxonomy beyond 'green’ to classify a wider range of economic activities (the Report).

On 30 March 2022, the EU's Platform on Sustainable Finance (the Platform) published a report setting out its recommendations to the European commission relating to technical screening criteria for objectives 3-6 of the Taxonomy Regulation ((EU) 2020/852) (the Report).

On 30 March 2022, the EU Commission published a proposal for a directive on empowering consumers for the green transition (the Proposal) in order to amend the Consumers Rights Directive and Unfair Commercial Practices Directive (UCPD).

On 25 March 2022, the European Supervisory Authorities (the European Banking Authority, the European Insurance and Occupation Pensions Authority, and the European Securities and Markets Authority) (the ESAs) published an updated supervisory statement (the Supervisory Statement) on the application of the Sustainable Finance Disclosure Regulation ((EU) 2019/2088)(SFDR).

On 24 March 2022, the Network for Greening the Financial System (NGFS) published a statement on nature-related financial risks, recognising that without mitigation these risks could have significant macro-economic implications for financial stability.

On 24 March 2022, Natasha Cazenave, Executive Director of the European Securities and Markets Authority (ESMA) gave a speech highlighting the key priorities for the asset management industry in 2022, focussing on sustainable finance and systemic risk.

On 23 March 2022, the US Securities and Exchange Commission (the SEC) released its 506-page proposal in relation to the enhancement and standardisation of climate-related disclosures for investors (the Proposal) in which it set out its proposal for a major expansion of US public company reporting to include climate-related disclosures in both registration statements and annual reports.

On 15 March 2022, the UK High Court (Stuart-Smith LJ and Thornton J) dismissed an application for judicial review in R (Friends of the Earth Ltd) v Secretary of State for International Trade/Export Credits Guarantee Department (UK Export Finance) [2022] EWHC 568 (Admin) by Friends of the Earth (the Claimant).

On 14 March 2022, the European Central Bank (ECB) published a report on the supervisory assessment of banks' climate-related and environmental (C&E) risks disclosures. The report focussed on the risk disclosure practices of banks in the single supervisory mechanism which are classed as significant institutions.

On 14 March 2022, the International Organisation of Securities Commissions (IOSCO) announced the details of its 2022 sustainable finance work plan.

On 9 March 2022, the European Commission adopted the final text of a Complementary Climate Delegated Act, which amends the Taxonomy Climate Delegated Act ((EU) 2021/2139) by setting out technical screening criteria for natural gas and nuclear activities to be included in the list of economic activities under the Taxonomy Regulation ((EU) 2020/852).

On 2 March 2022, the European Banking Authority (EBA) published a report analysing the developments and challenges of introducing a framework for sustainable securitisation.

On 28 February 2022, the Platform on Sustainable Finance (the Platform) published the final report of the Subgroup on Taxonomy (the Report) on the proposed structure of a social taxonomy designed to fit within the present EU legislative framework for sustainable finance and sustainable governance.

On 23 February 2022, the European Commission (the Commission) published its proposal for a Corporate Sustainability Due Diligence Directive (the Proposed Directive), which would introduce new sustainability due diligence obligations on large EU companies, mid-size EU companies in 'high-impact' sectors, and certain non-EU companies with significant EU activity.

In February 2022, the UK's Financial Conduct Authority (FCA) published its 'ESG Sourcebook' which sets out new rules for climate-related disclosures by asset managers, life insurers and FCA-regulated pension providers in one place.

On 21 February 2022, the UK Government's Department for Business, Energy & Industrial Strategy (BEIS) published non-binding guidance in relation to new mandatory climate-related financial disclosures for publicly quoted companies, large private companies and limited liability partnerships (LLPs).

On 15 February 2022, the European Banking Federation (the EBF) and the UN Environment Programme Finance Initiative (UNEP FI) published a report, 'Practical approaches to applying the EU Taxonomy to bank lending' (the Report) which is aimed at banks looking to use the EU Taxonomy.

On 14 February 2022, the Partnership for Carbon Accounting Financials (PCAF) launched its 'European Building Emission Factor Database' (the Database) which is a publicly available tool for all financial institutions and further interested stakeholders.

On 14 February 2022, the World Economic Forum's Global Future Council on Nature-Based Solutions published a new white paper, 'Scaling Investments in Nature: The Next Critical Frontier for Private Sector Leadership' (the White Paper) which takes a practical look at the investment landscape for nature and nature-based solutions.

On 11 February 2022, the European Securities and Markets Authority (ESMA) published its 'Sustainable Finance Roadmap 2022-2024' (the Roadmap), which builds upon ESMA's 2020 'Strategy on Sustainable Finance'.

On 10th February 2022, the European Securities and Markets Authority (ESMA) published a paper in relation to its study of the implementation of its guidelines on how and when credit rating agencies' (CRAs') consideration of ESG factors are disclosed in credit rating press releases (the Guidelines). The Guidelines have been applicable since March 2020.

On 9 February 2022, the Bank of England launched the second round of the Biennial Exploratory Scenario (BES) exercise on financial risks from climate change, with the intention of exploring the financial risks posed by climate change for the UK's largest banks and insurers.

On 2nd February 2022, the European Commission adopted a draft notice on the interpretation of certain legal provisions of the Taxonomy Disclosures Delegated Act ((EU) 2021/2178) on the reporting of eligible economic activities and assets.

On 2 February 2022, ClientEarth, as well as a separate coalition of environmental NGOs, filed internal review requests to the European Commission alleging that it has unlawfully labelled bioenergy, bio-based plastics and chemicals used to make plastics as 'sustainable' under the EU Taxonomy. Both groups argue that the categorisation of these substances as sustainable is scientifically flawed and undermines the credibility of the EU Taxonomy.

On 2 February 2022, the European Commission (the Commission) approved, in principle, a draft complementary delegated act (the Taxonomy Complementary Delegated Act) which sets out the technical screening criteria for the inclusion of certain nuclear and gas activities in the list of economic activities covered by the EU Taxonomy. Once made available in all European languages, the Commission will formally adopt the Taxonomy Complementary Delegated Act and send it for scrutiny by the European Parliament and Council.

On 27 January 2022, the Science and Technology Select Committee (the Committee) of the House of Lords published a report titled 'Nature-based solutions: rhetoric or reality?' (the Report).

On 27 January 2022, the European Central Bank (ECB) launched its 2022 climate risk stress test (2022 CST) which involves banks that are part of the Single Supervisory Mechanism and which the ECB directly supervise.

On 27 January 2022, the European Commission (the Commission) made the announcement that it has formally adopted the new Guidelines on state aid for climate, environmental protection and energy (the Guidelines).

On 24 January 2022, the EU Platform on Sustainable Finance (the Platform) published its response to the European Commission's call for feedback on a draft text of a Taxonomy Complementary Delegated Act which covers gas and nuclear activities under the Taxonomy Regulation ((EU) 2020/852).

On 24th January 2022, the European Banking Authority (EBA) published its final draft implementing technical standards (ITS) on Pillar 3 disclosures of ESG risks, aiming to ensure that stakeholders are well-informed about institutions' ESG business strategy, and can make well-informed decisions.

On 11 January 2022, the Department for Environment, Food and Rural Affairs (Defra) published a consultation regarding the implementation of regulations surrounding mandatory Biodiversity Net Gain, an approach to development that leaves biodiversity in a better state than it was beforehand.

On 1 January 2022, the European Commission announced that it had commenced expert consultations with the Platform on Sustainable Finance and the Member States Expert Group on Sustainable Finance on the draft text of a complementary Delegated Act (the Complementary Delegated Act) to the Taxonomy Regulation ((EU) 2020/852), covering nuclear and natural gas activities.

On 17 December 2021, the UK's Financial Conduct Authority (the FCA) published a policy statement which provided confirmation of the final rules and guidance established to promote improved climate-related disclosures for issuers of standard shares or equity shares represented by certificates.

On 21 December 2021, the Royal Institute of Chartered Surveyors (RICS) published an updated guidance note providing practical and globally relevant principles for the delivery of the sustainability and ESG requirements in the Red Book Global Standards.

On 20 December 2021, the Platform on Sustainable Finance published a paper setting out its considerations on voluntary information as part of Taxonomy-eligibility reporting (the Report).

On 17 December 2021, the UK's Financial Conduct Authority (FCA) published its policy statement (PS21/24) on improving climate-related disclosures made by asset managers, life insurers and FCA-regulated pension providers.

On 10 December 2021, Commission Delegated Regulation ((EU) 2021/2178) (CDR) was published in the Official Journal of the European Union supplementing Article 8 of the Taxonomy Regulation ((EU) 2020/852).

On 9 December 2021, Commission Delegated Regulation ((EU) 2021/2139)(the Delegated Regulation), made under Articles 10(3) and 11(3) of the Taxonomy Regulation, was published in the Official Journal of the European Union.

On 3 December 2021, the UK Government's Department for Environment, Food and Rural Affairs (Defra) launched a consultation on its proposed mandatory forest risk commodities due diligence regime. The aim of the regime is to help to prevent illegal deforestation in UK supply chains.

On 25 November 2021, the European Commission confirmed that it will further delay the application of the regulatory technical standards (RTS) supplementing the Sustainable Finance Disclosure Regulation ((EU)(2019/2088)) from 1 July 2022 to 1 January 2023.

On 23 November 2021, the International Organization of Securities Commissions (IOSCO) published its final report on ESG ratings and data products providers (FR09/21)(the Report) which draws on information from draft recommendation consultations in July 2021.

On 23 November 2021, the UK Government's Cabinet Office published the Net Zero Estate Playbook (the Playbook), setting out key policies and guidance which outlines the UK Government's expectations of property professionals in the transition of UK public building and estates to net zero.

On 22 November 2021, the Council of the European Union published an overview on the progress of the EU's 'Fit for 55' package, assessing the overall progress to be good at a technical level.

On 19 November 2021, the European Securities and Markets Authority (ESMA) published the transcript of a keynote speech by ESMA Chair, Verena Ross, covering ESG reporting, risk management, strategy and responsibility.

On 16 November 2021, the UK Green Building Council (UK GBC) launched a Net Zero Whole Life Carbon Roadmap (the Roadmap) with the aim of outlining a common vision and agreeing on industry-wide actions in order to achieve net zero for buildings and infrastructure in the UK.

On 15 November 2021, the UK Financial Conduct Authority (FCA) published a special edition (36^th edition) of the Primary Market Bulletin (PMB 36), in which it introduced specific Task Force on Climate-related Financial Disclosures (TCFD) aligned climate-related disclosure requirements for listed companies and set out its disclosure expectations and supervisory strategy.

On 13 November 2021, nearly 200 countries agreed the Glasgow Climate Pact (the GCP) which is intended to speed up the pace of climate action in an endeavour to keep the 1.5°C global warming target in reach.

On 12 November 2021, the European Commission published a consultation paper ('Strengthening of the quality of corporate reporting and its enforcement') seeking responses on the quality of EU corporate reporting by listed companies and public interest entities, and the enforcement of this reporting.

On 10 November 2021, the Russian Federation officially adopted the Russian Green Taxonomy (the RGT) which was developed with the aim of compatibility with international best practice.

On 10 November 2021, the International Chamber of Commerce (ICC) published a discussion paper titled 'Standards for Sustainable Trade & Sustainable Trade Finance', as part of the first phase of a programme to begin defining and setting the standards for sustainable trade in a manner that provides sufficient transparency into the sustainability characteristics of a transaction.

On 9 November 2021, the Network for Greening the Financial System (NGFS) published a technical document which highlights the trends in climate-related litigation in a bid to increase awareness.

On 9 November 2021, the Environment Bill received the Royal Assent and the Environment Act 2021 (the Act) was passed. The Act establishes new legally binding environmental targets, together with the formation of an independent Office for Environmental Protection which will enforce these targets by holding the UK Government and public bodies to account with regards to their environmental obligations.

On 5 November 2021, the Government of the Netherlands released a non-paper describing its commitment to European legislation for international corporate social responsibility. The document, 'Mandatory due diligence: Building blocks for effective and ambitious European due diligence legislation' emphasises the support from the Netherlands for EU due diligence legislation aimed at safeguarding human rights and the environment.

On 4 November 2021, the International Platform on Sustainable Finance (the IPSF) released the first phase of its work on the Common Ground Taxonomy (CGT), which is the result of an in-depth comparison exercise, and which puts forward areas of commonality and difference between the EU and Chinese green taxonomies.

On 4 November 2021, the International Platform on Sustainable Finance (the IPSF) released a paper on the state and trends of ESG disclosure policy measures across IPSF jurisdictions, Brazil and the US.

On 3 November 2021, the International Financial Reporting Standards Foundation (IFRS Foundation) announced three key developments in the advancement of high-quality disclosures on climate and other sustainability issues within global financial markets.

On 3 November 2021, the UK Financial Conduct Authority (FCA) published a discussion paper (DP21/4) (the Discussion Paper) seeking initial views from all parts of the financial sector on proposed sustainability disclosure requirements (SDR) for asset managers and certain FCA-regulated asset owners, and the products they offer.

On 3 November 2021, the UK Financial Conduct Authority (FCA) published its refreshed ESG strategy outlining its priorities and how it intends to deliver on the ESG-based targets set out in its Business Plan for 2021/22.

On 3 November 2021, the Network for Greening the Financial System (NGFS) published its 'Glasgow Declaration' (the Glasgow Declaration), reiterating its willingness to contribute to the global response required to meet the objectives of the Paris Agreement.

On 2 November 2021, the International Organization of Securities Commissions (IOSCO) published its final report which sets out its recommendations on sustainability-related practices, policies, procedures and disclosures in asset management.

On 2 November 2021, the UK Government announced a move towards making publication of transition plans mandatory for asset managers, regulated asset owners and listed companies in a bid to become the first 'Net Zero-aligned Financial Centre'.

On 31 October 2021, the 26th UN Climate Change Conference of the Parties (COP 26) began in Glasgow. The COP26 summit is intended to bring parties together to accelerate action towards the goals of the Paris Agreement and the UN Framework Convention on Climate Change.

On 28 October 2021, the UK Financial Conduct Authority (FCA), Prudential Regulation Authority (PRA), Financial Reporting Council (FRC) and The Pensions Regulator (TPR) published a joint statement welcoming the UK Government's invitation under the Climate Change Act 2008 to publish Climate Change Adaptation Reports.

On 26 October 2021, the Network for Greening the Financial System (NGFS) released a progress report on the implementation of its guide for supervisors on integrating climate-related and environmental risks into prudential supervision.

On 21 October 2021, the Climate Financial Risk Forum (CFRF) released its second set of guides, the 'Session 2 guides', addressing climate-related financial risks and opportunities.

On 19 October 2021, the Network for Greening the Financial System (NGFS) published a progress report setting out how 31 NGFS members are using climate scenarios to identify, assess and understand climate risks in relation to their economies and financial systems.

On 18 October 2021, the UK Government published a policy paper, 'Greening Finance: A Roadmap to Sustainable Investing' (the Roadmap), which maps its ambition to green the financial system and align it to the UK's net zero commitment.

On 18 October 2021, the European Central Bank (ECB) published a letter which was sent to the Chief Executive Officers of significant institutions that it directly supervises regarding the ECB's 2022 climate risk stress test (2022 CST)

On October 15 2021, the United Nations Environment Programme Finance Initiative (UNEP FI) released its first report on the progress made by signatories of the Principles of Responsible Baking group (the Principles).

On 14 October 2021, the Task Force on Climate-related Financial Disclosure (TCFD) published updated implementing guidance (the Implementation Guidance), superseding and replacing the 2017 Annex 'Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures'.

On 14 October 2021, the Task Force on Climate-related Financial Disclosure (TCFD) published updated implementing guidance (the Implementation Guidance), superseding and replacing the 2017 Annex 'Implementing the Recommendations of the Task Force on Climate-related Financial Disclosures'.

On 11 October 2021, the first phase of the 15th UN Biodiversity Conference (COP15) is taking place and will involve a review of the progress made by the UN Convention on Biological Diversity (CBD) in achieving the 20 Aichi Biodiversity Targets set out in its 'Strategic Plan for Biodiversity for 2011-2020'.

On 8 October 2021, the Network for Greening the Financial System (NGFS) released an interim report indicating that the effects of biodiversity loss could have significant economic and financial implications.

On 30 September 2021, The Chancery Lane Project (TCLP) published its net zero toolkit which aims to enable lawyers to use climate and net-zero aligned clauses within their contracts, aligning the work they do with a decarbonised economy.

On 6 October 2021, the Institutional Investor Group on Climate Change (IIGCC) published a 23-page guide that is intended to set out investor expectations of investee companies regarding the governance, assessment, management, and disclosure of physical climate risks and opportunities.

On 5 October 2021, Edouard Fernandez-Bollo, Member of the Supervisory Board of the European Central Bank (ECB) delivered a speech on banking supervision priorities post-pandemic, emphasising the need for banks to incorporate climate-related and environmental risks into their strategy and risk governance.

On 29 September 2021, the Government of Netherlands published new legislation to improve diversity on the Supervisory Boards of Dutch listed companies.

On 24 September 2021, the UK Financial Conduct Authority (FCA) published a speech setting out its expectations in relation to ESG.

On 22 September 2021, the European Court of Auditors (the ECA) published a special report (Special Report 22/2021: Sustainable finance: More consistent EU action needed to redirect finance towards sustainable investment) and accompanying annexes (the Report). The Report stresses that more consistent EU action is required in order to redirect private and public finance towards sustainable investments.

On 21 September 2021, the sale of the UK's first Green Gilt raised £10 billion. The Green Gilt is intended to direct funding towards net zero and green projects and is the largest inaugural green issuance by any sovereign.

On 21 September 2021, the European Central Bank (ECB) published the results of its first economy-wide climate stress test (ECB Occasional Paper Series No 281 / September 2021) which builds on exercises performed previously by other central banks and supervisory authorities across four dimensions.

On 21 September 2021, the European Commission (the Commission) published a request for advice (Ares(2021)4439183) from the European Banking Authority (EBA) in relation to the Commission's review of the EU banking macro-prudential framework and its exposure to global risks, including climate change.

On 20 September 2021, the UK Competition and Markets Authority (CMA) published a Green Claims Code with the aim of preventing greenwashing through providing guidance to businesses looking to communicate their environmental credentials.

On 20 September 2021, the Climate Disclosure Standards Boards (CDSB) opened for consultation its 'Application guidance for biodiversity-related disclosures' (the Biodiversity Guidance). The Biodiversity Guidance builds upon evidence from the CDSB's recent research which concluded a definitive gap in the integration of biodiversity matters into mainstream reporting.

On 20 September 2021, the Basel Committee on Banking Supervision (BCBS) published a press release following two BCBS meetings which took place on the 15th and 20th September 2021.

On 14 September 2021, the International Organization for Standardization (ISO) published a new series of standards for the green finance market (the ISO Standards). The ISO Standards, which were developed by a working party of industry experts including the LMA, provide an internationally applicable framework for issuing green bonds and originating green loans.

On 27 August 2021, the European Commission released an expansive study entitled, 'Development of Tools and Mechanisms for the Integration of ESG Factors into the EU Banking Prudential Framework and into Banks' Business Strategies and Investment Policies' (the Study).

On 26 August, the UK Government tabled various amendments to be made to the Environment Bill, which aim to strengthen the provisions in place to halt biodiversity loss as well as to further tackle water pollution.

On 17 August 2021, the UK Department for Business, Energy and Industrial Strategy (BEIS) issued a press release detailing the UK Government's vision to kick-start a world leading hydrogen economy to support in excess of 9,000 UK jobs and release £4bn investment by 2030.

The innovation branch of the UK's Financial Conduct Authority (FCA Innovation) has announced the launch of a programme of work to assist firms and regulators to overcome some of the challenges that moving to a net zero economy will raise in the area of sustainability and climate change.

On 9 August 2021, the Intergovernmental Panel on Climate Change (IPCC) published its Sixth Assessment Report (AR6), 'Climate Change 2021: The Physical Science Basis' (the Report). The Report addresses the most up to date scientific understanding of the climate system and climate change.

On 4 August 2021, the EU Platform on Sustainable Finance (the Platform) published a draft report containing preliminary technical screening criteria (TSC) for environmental objectives 3-6 under Article 3 of the Taxonomy Regulation (as well as some additional criteria for environmental objectives 1-2). The TSC was developed by the Platform's Technical Working Group (TWG) and includes a call for feedback.

On 29 July 2021, the Voluntary Carbon Markets Integrity Initiative (VCMI) was launched, an initiative which is to be co-funded by the UK Government and Children's Investment Fund Foundation.

On 26 July 2021, the European Commission responded to a number of queries raised by the European Supervisory Authorities (ESAs) about the application of the Sustainable Finance Disclosure Regulation ((EU) 2019/2088) (SFDR) (the Q&A Document).

On 19 July 2021, the UK Financial Conduct Authority (FCA) published a letter addressed to authorised fund managers (AFMs) outlining the FCA's expectations on the design, delivery and disclosure of ESG and sustainable investment funds (the Letter).

On 15 July 2021, the House of Commons Treasury Committee (the Committee) released the, 'First Special Report of Session 2021-22: Net Zero and the Future of Green Finance: Responses to the Committee’s Thirteenth Report of Session 2019-21 (HC 576)' (the Special Report). The Special Report includes responses from the UK Financial Conduct Authority (FCA), the Bank of England (BoE) and HM Treasury (the Treasury) to the Committee’s 'Thirteenth Report of Session 2019-21: Net Zero and the Future of Green Finance (HC 147)'.

On 12 July 2021, the Platform on Sustainable Finance (the Platform) published two draft reports: (i) the 'Draft Report by Subgroup 4: Social Taxonomy' (the Draft Social Taxonomy Report) and (ii) the 'Public Consultation Report on Taxonomy extension options linked to environmental objectives' (the Draft Taxonomy Extension Report).

On 8 July 2021, in a letter to the European Economic and Financial Affairs Council, the European Commission confirmed that the application of the regulatory technical standards (RTS) under the Sustainable Finance Disclosure Regulation ((EU) 2019/2088) is to be delayed by six months from the original application date of 1 January 2022 to 1 July 2022.

On 7 July 2021, the Financial Stability Board (FSB) published a roadmap, ‘Roadmap for addressing climate-related financial risks’ (the Roadmap) which will be presented to the G20 Finance Ministers and Central Bank Governors for their endorsement on 9-10 July 2021.

On 6 July 2021, the European Commission adopted a delegated act (C(2021) 4987 final) (the Delegated Act) in supplement of Article 8 of the Taxonomy Regulation ((EU) 2020/852). The Delegated Act sets out the content, methodology and presentation of the key performance indicators that non-financial and financial undertakings are required to disclose under Article 8 of the Taxonomy Regulation.

On 6 July 2021, the European Commission (the Commission) adopted a package of measures aimed at enhancing the flow of capital towards financing the transition to a stronger, sustainable European economy, with the intention of making the EU a global leader in the setting of standards for sustainable finance.

On 1 July 2021 the European Central Bank (ECB) and European Systemic Risk Board (ESRB) released a joint report publication on climate-related risk and financial stability. The report analyses an expanded set of climate change drivers over long-dated financial risk horizons, aiming to provide a more encompassing and robust quantification of financial stability risks in the EU to underpin targeted and effective policy action.

On 30 June 2021, the International Organisation of Securities Commissions (IOSCO) launched a consultation requesting feedback on proposed recommendations regarding sustainability-related regulatory and supervisory expectation in the asset management industry.

On 28 June 2021, the International Organisation of Securities Commissions (IOSCO) published a report on corporate issuers' sustainability-related issuer disclosures. The report was developed by IOSCO's Sustainable Finance Taskforce (STF) and puts emphasis on the urgent need to improve the consistency, comparability and reliability of sustainability reporting for investors.

On 23 June 2021, the European Banking Authority (EBA) published its report, 'EBA Report on Management and Supervision of ESG Risks for Credit Institutions and Investment Firms', providing a comprehensive proposal on how ESG factors and risks should be included in the regulatory and supervisory framework for credit institutions and investment firms.

The UK Financial Conduct Authority (FCA) published two new proposals on climate related disclosure rules for listed companies and certain regulated firms on 22 June 2021. The proposals follow the introduction of climate related disclosure rules for prominent listed commercial companies in December 2020.

On 16 June 2021, the Global Financial Markets Association (GFMA) released a paper (the GFMA Paper) outlining several global guiding principles deemed necessary for developing climate finance taxonomies.

With the intention of illustrating the contents of the EU taxonomy in an accessible manner, the EU Commission launched an EU Taxonomy Compass webpage on 15 June 2021. It aims to provide a visual representation of the contents of the EU Taxonomy.

HM Treasury (HMT) has appointed the Green Technical Advisory Group (GTAG) to oversee the governments delivery of a green taxonomy – a framework setting standards for investments to be deemed environmentally sustainable.

As part of the investigation into the resilience of the UK's financial system to physical and transition risks associated with different climate pathways, the 2021 Biennial Exploratory Scenario (BES) was published by the Bank of England (BoE) on 8 June.

On 7 June 2021, the Task Force on Climate-related Financial Disclosures (TCFD) published a consultation on its 'Proposed Guidance on Climate-related Metrics, Targets and Transition Plans' (the Proposed Guidance) and the associated document 'Measuring Portfolio Alignment: Technical Supplement' (the Technical Supplement).

The Network for Greening the Financial System (NGFS) has published a revised issue of the climate scenarios and a dedicated website, both aimed at fostering the integration of climate-related risks into the work of central banks and supervisors, and beyond.

Resultant of several meetings between 28 May and 5 June, G7 Finance Ministers and Central Bank Governors have published a communiqué laying out actions aimed at deeper multilateral economic cooperation.

On 4 June 2021, the European Commission formally adopted Commission Delegated Regulation supplementing the Taxonomy Regulation ((EU) 2020/85) on sustainable activities for climate change adaptation and mitigation objectives (the Climate Delegated Act). This follows the political agreement being reached on the Climate Delegated Act on 21 April 2021.

On 3 June 2021, the Bank of England (BoE) published a speech by Andrew Bailey, Governor of the Bank of England, addressing the role that central banks must play in tackling climate change.

The Equator Principles Association (EPA) has published a press release announcing that it has endorsed the recently released Organisation for Economic Co-operation and Development (OECD) Good Practice Note for Environmental and Social Agents (the Note).

On 28 May 2021, the International Regulatory Strategy Group (IRSG) published a paper setting out recommendations for reviewing the EU Taxonomy for UK application. The paper considers the purpose and usability of the EU Taxonomy, as well as the practical challenges of implementing a version of the EU Taxonomy that reflects the needs and specificities of the UK economy.

On 27 May 2021, the French Government published, in the Official Journal, Decree 2021-663 of 27 May 2021 issued for the application of article L. 533-22-1 of the Monetary and Financial Code (the Decree).

On 26 May 2021, the Network for Greening the Financial System (NGFS) published a progress report on bridging climate-related data gaps as part of the first phase of their work in this area. The report sets out the key issues that need to be considered going forward.

The Council of the EU (the Council) has approved a set of conclusions on a sustainable blue economy, which are based on four pillars: healthy oceans, knowledge, prosperity and social equity. The conclusions underline the need for an efficient ocean governance built on a sustainable blue economy.

The Bank of England has published a speech by Sarah Breeden, Executive Director, UK Deposit Takers Supervision, discussing how financial services firms in the UK can act as stewards in the move to a ‘net zero’ economy.

On 18 May 2021, the International Capital Market Association (ICMA) published a paper providing an overview of taxonomies for sustainable finance and recommending success criteria to benchmark current and future taxonomy initiatives, with the objective of promoting international consistency and market usability.

S&P Global Ratings has published a request for comments on its proposed methodology articulating the principles applied to incorporate environmental, social, and governance (ESG) credit factors into its credit ratings analysis.

The German federal cabinet has adopted the revised Climate Change Act, setting the country on course to achieve climate neutrality by 2045 with new and more ambitious binding targets.

On 7 May 2021, the European Commission published for consultation a draft delegated act (the Delegated Act) supplementing the Taxonomy Regulation ((EU) 2020/852) specifying the content, methodology, and presentation of the information to be disclosed by large financial and non-financial undertakings subject to the non-financial reporting directive (NFRD) concerning their environmentally sustainable economic activities.

On 5 May 2021, the German Federal Cabinet adopted the first German Sustainable Finance Strategy (the Strategy). The goal of the Strategy is to mobilise investments that are urgently needed for climate action and sustainability, while also addressing the climate risks that are increasingly relevant to the financial system.