The recent ESMA Final Report on the Guidelines for funds’ names using ESG or sustainability-related terms (the “Guidelines”) marks a critical moment for asset managers. These Guidelines aim to clarify when the use of ESG or sustainability-related terms in fund names may be deemed unfair, unclear or misleading. The Guidelines introduce minimum asset allocation thresholds
ESG Ratings Regulation progresses – asset managers to keep watch
UPDATE: On 19 November 2024, the Council of the EU issued a press release confirming it had adopted the EU Ratings Regulation. The next step is that the Regulation will be published in the Official Journal of the EU and enter into force 20 days later – applying 18 months after is entry into force.
FCA publishes SDR and investment label pre-contractual disclosure examples
On 1 November 2024, the Financial Conduct Authority (“FCA”) updated its sustainability disclosure and labelling regime website and added detailed examples of pre-contractual disclosures to its Sustainability Disclosure Requirements (“SDR“) guidance. The SDR and investment labels regime enters into force on 2 December 2024 and firms have been able to use investment labels
FCA publishes paper on nature-related risk for financial institutions
The FCA’s Climate Financial Risk Forum has published a paper on “Nature-related Risk: Technical Data Guidance for Financial Institutions” (the ‘‘Paper’’).
What does the FCA’s Paper cover?
The Paper serves as a useful summary of the potential relevance of nature on financial institutions and covers the following fundamental concepts:
- The nature data landscape;
Regulation Round Up
Welcome to the Regulation Round Up, a regular bulletin highlighting the latest developments in UK and EU financial services regulation.
Key developments in October 2024:
31 October
ESG: The Transition Plan Taskforce (‘‘TPT’’) published its final report (Progress Achieved and the Path Ahead: The Final Report of the Transition Plan Taskforce)
Motor Finance Cases Set New Standards for Disclosure
The Motor Finance Commission Claims – including Johnson v FirstRand Bank, Wrench v FirstRand Bank, and Hopcraft v Close Brothers – are a set of Court of Appeal cases addressing undisclosed or partially disclosed commission payments in motor finance agreements.
Key Points:
1. Background:
The claimants were financially unsophisticated consumers who relied on
Launch of the Taskforce on Inequality and Social-related Financial Disclosures
The Taskforce on Inequality and Social-related Financial Disclosures (“TISFD”) launched on 23 September 2024.
Background
The TISFD is a global initiative with the aim of developing recommendations and guidance for businesses and financial institutions to report on inequality and social-related financial risks, opportunities, impacts and dependencies (“TISFD Disclosure Framework”). The TISFD
Sanctions Considerations for Private Equity Firms – a few practical tips
- Background
Private equity firms could face significant sanctions risks when doing business with entities connected to sanctioned jurisdictions (such as Russia). These risks may arise in a number of ways (either directly or via indirect connections to sanctioned entities / individuals), including:
FCA publishes Dear CEO letter setting out expectations for financial advisers and investment intermediaries
On 7 October 2024, the FCA issued a “Dear CEO letter” (“Letter”) to firms whose primary business is financial advice or investment intermediation. The Letter contains a summary of the FCA’s priorities and expectations of firms in this sector.
Priorities
The FCA’s priorities over the next two years are:
- to reduce and prevent
Regulation Round Up
Welcome to the UK Regulation Round Up, a regular bulletin highlighting the latest developments in UK and EU financial services regulation.
Key developments in September 2024:
30 September:
Digital Securities Sandbox: The Bank of England and the Financial Conduct Authority (“FCA”) published a joint policy statement (PS24/12), final guidance and other materials setting