Weekly ESG News: Financial Services and Insurance Industry (25/2024)
FCA opened first enforcement investigation over climate-related issues
The UK Financial Conduct Authority (FCA) has initiated its first climate-related enforcement investigation, as revealed by a Freedom of Information (FOI) request led by ClientEarth lawyers.
Products & Services
UBS invests in impact and nature data provider GIST Impact
GIST Impact has announced an investment from UBS Next to enhance its impact data and analytics solutions. This collaboration aims to support companies and investors in measuring environmental and social impacts, aligning with new regulations like CSRD and TNFD. Andre Hoffmann of GIST Impact emphasized the partnership’s role in integrating sustainability into business strategies. UBS CEO Sergio Ermotti highlighted the importance of impact data for managing portfolios sustainably. GIST Impact’s CEO Pavan Sukhdev noted that their advanced algorithms and valuation platforms will drive better social and environmental outcomes.
Indosuez announced the launch of its first SFDR bond fund
Indosuez Wealth Management has launched its first SFDR Article 9 bond fund, Indosuez Funds – Chronos Green Bonds 2028. This fund invests in green bonds from companies with environmentally positive projects, aligning with the UN Sustainable Development Goals. Targeted at conservative investors, it offers fixed maturity and moderate risk, comprising around 60 securities. Managed by Indosuez’s bond team in Paris, the fund supports the energy transition and meets private investor demand for sustainable investments.
Regulations, Law and Frameworks
TNFD and EFRAG publish mapping guidance for ESRS
The Taskforce on Nature-related Financial Disclosures (TNFD) and EFRAG have released a mapping of the European Sustainability Reporting Standards (ESRS) to TNFD’s recommended disclosures. This mapping shows that all 14 TNFD disclosures are included in the ESRS, aiding companies in aligning their nature-related reporting. The collaboration highlights shared definitions, the LEAP approach, and double materiality. Both frameworks use the TCFD’s disclosure pillars to ensure consistent, high-quality sustainability information. Access the TNFD-ESRS correspondence mapping.
Swiss Federal Council updates on sector progress in preventing greenwashing
On 19 June 2024, the Federal Council acknowledged the financial sector’s new self-regulatory measures to combat greenwashing, aligning with its 2022 position on the issue. These provisions, developed by the Swiss Bankers Association, the Asset Management Association Switzerland, and the Swiss Insurance Association, will be enforced by 1 January 2027. They include defining sustainable investment objectives, describing sustainability approaches, and requiring third-party audits. Given the progress and the EU’s ongoing updates to the Sustainable Finance Disclosure Regulation (SFDR), the Federal Council will not introduce state regulations for now but will reassess the need for action by the end of 2027, pending EU developments.
FCA opened first enforcement investigation over climate-related issues
The UK Financial Conduct Authority (FCA) has initiated its first climate-related enforcement investigation, as revealed by a Freedom of Information (FOI) request led by ClientEarth lawyers. This case, opened in July 2023, follows persistent efforts by ClientEarth to obtain transparency from the FCA regarding greenwashing and climate cases. Despite this progress, the FCA is criticized for lagging behind other regulators like those in the US and Australia, which have already imposed significant penalties for environmental misstatements. ClientEarth urges the FCA to leverage new anti-greenwashing rules for more decisive action.
ESG Data & Analytics
Bloomberg launches CSRD data solution for financial firms
Bloomberg launched a new data offering on the Bloomberg Terminal and via Data License, aligning with the EU’s CSRD. It integrates ESRS with Bloomberg data fields, offering historical and mandatory quantitative disclosures on financial and impact criteria. This supports financial firms in enhancing sustainability strategies and streamlining reporting. Patricia Torres emphasized the role of robust ESG data in investment decisions. The CSRD data is accessible via {ESGD <GO>} on the Bloomberg Terminal and Data License for enterprise use.
Workiva expands platform with carbon accounting, carbon management and decarbonization solution
Workiva Inc. has launched Workiva Carbon, expanding its ESG platform with Carbon Accounting, Management, and Decarbonization. This offering supports global climate regulations like the CSRD and SEC’s climate disclosure rules, enabling companies to track greenhouse gas emissions, manage supplier engagement, collaborate across functions, and report data seamlessly. This supports sustainability goals and enhances transparency in reporting.
Persefoni and First Street Partner launch physical climate risk solution
Persefoni and First Street are integrating advanced physical climate risk data into Persefoni’s Climate Management & Accounting Platform (CMAP) to streamline enterprise climate reporting and compliance with global regulations such as the SEC and California’s SB 261. This integration, launching in Q4 2024, will initially cover U.S.-based assets, with plans for global coverage, enhancing accuracy and efficiency in climate disclosure and reporting.
ESG Book and Risk Software Labs announced partnership for MENA region
ESG Book has partnered with Risk Software Labs to offer leading ESG solutions across the MENA region. This collaboration aims to meet the growing demand for ESG and climate data among financial institutions and corporations. Leveraging ESG Book’s extensive platform and Risk Labs’ regional expertise, the partnership will support companies in fulfilling ESG reporting obligations and integrating sustainability into their strategic decisions. This initiative underscores ESG Book’s commitment to expanding its footprint in sustainable finance across MENA.