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Clifford Chance


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Sustainability Newsletter: recent ESG developments

October 2022

ESG 12 October 2022

Environmental, Social and Governance (ESG) factors have fast risen to the top of the board agenda across all sectors, with increasing awareness that a failure to address these matters can be detrimental both financially and reputationally. Investor pressure, internal governance and the proliferation of regulatory requirements and voluntary standards across the globe makes this a complex area to manage.

This newsletter is intended to assist banks, financial investors and corporates in keeping up to date with ESG developments.

Further details of these and previous developments can also be found on our Green and Sustainable Finance Topic Guide on the Clifford Chance Financial Markets Toolkit and further related resources can be found on our Clifford Chance ESG page


Legal & Regulatory Developments

European Union

(30 September 2022) The Joint Committee of the European Supervisory Authorities (ESAs) published the Final Report on draft Regulatory Technical Standards (RTS) which amend the existing Sustainable Finance Disclosure Regulation (SFDR) RTS to align them with the Taxonomy Complementary Climate Delegated Act, which includes specific nuclear and gas energy activities in the list of environmentally sustainable economic activities covered by the EU Taxonomy. The draft amendments are intended as limited adjustments of the existing regulatory framework and include revised pre-contractual and periodic disclosure templates and minor technical revisions.

(26 September 2022) The European Securities and Markets Authority updated its sustainable finance implementation timeline, covering the Sustainable Finance Disclosures Regulation (SFDR), the Taxonomy Regulation (TR) and the Corporate Sustainability Reporting Directive (CSRD) amongst other Directives.

(14 September 2022) The European Commission announced its proposal to prohibit products made with forced labour on the EU market. The proposal covers all products, namely those made in the EU for domestic consumption and exports, and imported goods, without targeting specific companies or industries. Member States will implement this prohibition through a robust, risk-based enforcement approach. The proposal will need to be discussed and agreed by the European Parliament and the Council of the European Union before it can enter into force.

(13 September 2022) The European Parliament adopted its position on the Commission's proposal for a regulation on deforestation-free products with 453 votes to 57 and 123 abstentions. If passed, the law would set out mandatory due diligence rules for companies which want to place these commodities on the EU market with the aim to ensure that only deforestation-free and legal products are allowed on the EU market. The European Parliament is now ready to start negotiations on the final law with EU member states.

(6 September 2022) Various organisations responded to the Feedback on the Platform for Sustainable Finance's report on minimum social safeguards in the EU Taxonomy Regulation. The feedback closed for comments on 22 August 2022 and the final report will be published Q3 2022. | AFME response | ICMA response | Invest Europe response


(5 September 2022) The German Federal Financial Supervisory Authority (BaFin) published a document in which it answers various questions (in German) regarding Regulation (EU) 2019/2088 on sustainability‐related disclosures in the financial services sector (SFDR). BaFin notes that the SFDR contains undefined legal terms that financial market participants and financial advisors find difficult to interpret in practice and that the Q&A published by the EU Commission in July 2021 and May 2022 also raise application questions. In its report of 29 June 2022, BaFin announced that it would analyse the remaining issues and examine its own scope for action in this area. With the new Q&A, BaFin is publishing the first results and also plans to continuously expand the list.


(12 September 2022) Consob has unveiled the changes made to the 'Regolamento Emittenti' (Issuers' Regulations) to comply with the new European regulations on the distribution of Undertakings in Collective Investments in Transferable Securities (OICR), provided for by the Cross Border of Distribution of Funds Directive (CBDF) Package, which also includes new pre-contractual disclosure requirements for OCIR managers under the SFDR and Taxonomy Regulations. Consob has stated that in the Regolamento Emittenti this disclosure must be provided in the offer document or in a special annex, based on the provisions of Article 6 of the SFDR and the regulatory technical standards adopted by the Commission.


(7 September 2022) A new bill no. 8070 amending the Labor Code was tabled in the Chamber of Deputies with a view to implementing Directive (EU) 2019/1152 on transparent and predictable working conditions. There are significant changes that employers will face under the current version of the Bill including various provisions to be included in employment contracts such as overtime payment arrangements, termination of employment contracts, probationary period conditions and the right to training.

The Netherlands

(8 September 2022) The Netherlands Authority for the Financial Markets (AFM) announced that it will investigate (in Dutch) the state of compliance with a number of Sustainable Finance Disclosure Regulation (SFDR) requirements by investment fund managers in Autumn 2022. The AFM will examine, among other things, whether managers have tightened the SFDR classification of (sustainable) funds as a result of previous AFM investigations. The AFM will also examine to what extent administrators have made information available on their website about the policies relating to sustainability and the integration of sustainability into their remuneration policies. Finally, the AFM will examine to what extent managers comply with the transparency requirements that have been in force since 1 January 2022 on the basis of the Taxonomy Regulation. The AFM's investigation into compliance with the SFDR technical standards will be postponed to 2023.



(30 August 2022) The Spanish Council of Ministers approved the Roadmap for the sustainable management of mineral raw materials, which reinforces the country's strategic autonomy and the security of the provision of key supplies for energy transition. The Roadmap prioritises efficiency and the circular economy, and includes 46 measures for Spain to make the most of harnessing its indigenous resources in a more sustainable way and maximising economic, social economic and social benefits along the entire industrial value chain.

United States of America

(15 September 2022) The first federal 'Anti-SLAPP' Bill was introduced in the U.S. House of Representatives, which aims to deter strategic lawsuits against public participation. During a hearing in the Subcommittee on Civil Rights and Civil Liberties held to examine Strategic Lawsuits Against Public Participation ('SLAPPs'), Representative Jamie Raskin argued that the fossil fuel industry is one example of a player using SLAPPs to target environmental activists and non-profits to deter them from speaking out against proposed fossil fuel pipelines and other climate change projects. Representative Raskin, who introduced the bill, said the landmark legislation aims to protect free speech and uphold the integrity of the courts. To date, 32 states and the District of Columbia have passed anti-SLAPP laws, but the lack of federal protection has left a gap that is being exploited.

(12 September 2022) From September 12 to September 16, 2022, the Biden administration announced major executive actions across different sectors to tackle the climate crisis including: (1) the administration's approval of the first 35 state plans for electric vehicle charging stations, highlighting the administration's $85 billion investment in the manufacturing of electric vehicles, (2) steps to drive U.S. leadership on floating offshore wind platforms, an emerging technology that aims to harness the clean energy potential of deep waters, (3) the Administration's aim to reduce the costs of floating offshore wind by at least 70% by 2035, (4) new initiatives under the Federal Buy Clean Initiative to prioritize the purchase of lower-carbon steel, concrete, asphalt, and flat glass, and (5) the launch of as a tool to help families understand how the Inflation Reduction Act can save them money on energy efficient utilities. Alongside the Administration's announcements, the Agriculture Secretary Tom Vilsack announced a climate-smart agriculture initiative committing the USDA's support to 70 projects and 50,000 farms.

(30 August 2022) The California attorney general announced an investigation on racial and ethnic bias in healthcare algorithms intended to help determine patient care. The investigation comes as a result of a study that found one algorithm referred white patients to get enhanced medical services at a higher rate than their black counterparts with similar needs. California's Department of Justice kicked off the investigation by issuing a request to hospitals across the state to provide information regarding how the facilities and providers are identifying and addressing racial and ethnic disparities.

Official Publications


(20 September 2022) The Organisation for Economic and Co-operation Development published a Corporate Governance Working Paper entitled 'Enhancing gender diversity on boards and in senior management of listed companies' looking at the progress of listed companies' existing policies and practices. Covering 50 jurisdictions, it focuses on the implications of quotas and targets as the main instruments used to foster gender diversity on boards and considers the importance of complementary initiatives to strengthen the pipeline for leadership positions.

(15 September 2022) The International Organization of Securities Commissions published a statement welcoming standard-setters’ work on assurance of sustainability related corporate reporting.

(15 September 2022) The Basel Committee on Banking Supervision published a press release on its meeting held on 14-15 September 2022 discussing, amongst other things, the ongoing work relating to potential disclosure and supervisory and regulatory measures aimed at addressing climate-related financial risk.

(6 September 2022) The Network for Greening the Financial System (NGFS) published the third vintage of the climate scenarios along with two accompanying documents, aimed at fostering the integration of climate-related risks into the work of central banks and supervisors, and beyond. The NGFS scenarios provide a framework to assess and manage climate-related risks, by exploring the transition and physical impacts of climate change, over a long-time horizon and under varying assumptions. 

European Union

(7 September 2022) The European Central Bank published two articles, Climate transition: risks and opportunities and Climate risks for banks – the supervisory perspective highlighting the increasing risks that climate change is posing for banks and how transition plans should be evaluated for risk exposures.


(9 September 2022) The Luxembourg financial sector supervisory authority, the Commission de surveillance du secteur financier (CSSF) published its annual report for 2021. The report provides an overview of the CSSF's organisation and priority action areas, including the integration of innovation and sustainability in the financial sector supervisory activities and the analysis of the synergies between these two areas. One of the main challenges includes sustainable finance and green transition as the CSSF wants to make sustainable finance education a key priority.


(12 September 2022) The Monetary Authority of Singapore (MAS) and Singapore Exchange jointly launched SGenome, a digital disclosure portal for companies to report ESG data and for investors to access such data in a consistent and comparable format. MAS reported that significant disclosure challenges arose when there is a proliferation of multiple sustainability reporting frameworks and guidelines across jurisdictions along with the inconsistent way data is being collected, verified, and reported.

United Kingdom

(26 September 2022) The UK's Green Financing Programme launched in June 2021 commits the Government to regular reporting on how the funds raised support projects with environmental benefits. The UK Green Financing Allocation Report, 2021-22, the first since the Programme's launch, sets out how private capital is helping to finance government initiatives to address climate change and biodiversity loss. An Impact Report will be published in 2023 showing the environmental impacts of the schemes financed by the Programme.   


(20 September 2022) Uruguay's finance ministry announced the publication of the new framework for sustainability-linked bonds (SLBs). The Framework aligns with the five main components of ICMA’s 2020 Sustainability-Linked Bond Principles and sets targets for two key performance indicators linked to climate change mitigation and nature conservation objectives.

Industry Guidance, Voluntary Codes & Publications 


(14 September 2022) The Islamic Financial Services Board (IFSB) issued a press release announcing that Islamic Finance Leaders convened at the 4th IFSB Innovation Forum in Doha reinforcing their commitment to sustainable solutions for the Islamic finance industry.

(8 September 2022) The UN Global Compact published a brief which provides an introduction to the role of business in ensuring a just transition for all, and which sets out the foundation and meaning of the term "just transition" and outlines priority actions for companies, relevant areas of work and the business case. It also includes a glossary of key terms and a resource guide to support companies as they develop just transition plans that are ambitious, comprehensive and effective.


(5 – 9 September 2022) Borsa Italiana hosted the 2022 edition of Italian Sustainability Week, involving international and domestic asset managers, pension funds and Italian asset owners. The Italian Sustainability Week is the result of the cooperation between Borsa Italiana and the Sustainable Finance Partnership, an initiative launched with the aim of creating an integrated culture and ecosystem for the development of innovative Sustainable Finance solutions for the Italian capital market.

Hong Kong
(22 September 2022) The International Platform on Sustainable Finance (IPSF)’s Common Ground Taxonomy (CGT) provides a comprehensive mapping and comparison between EU and China taxonomies. Following its phase 1 report containing expert opinions on the anticipated adoption of CGT in Hong Kong and the Greater Bay Area, the Hong Kong Green Financial Association published CGT Research Series Phase 2: Understanding Use Cases of the Common Ground Taxonomy. In particular, the phase 2 report looks at 6 potential use cases based on industry experiences with taxonomies globally.

(15 September 2022): The Japanese Ministry of Economy, Trade and Industry published a set of non-binding Guidelines on Respect for Human Rights in Responsible Supply Chains (the Guidelines) that are intended to provide practical guidance on the steps that in scope companies should take to implement their commitments to respect human rights. The Guidelines are based on international standards relating to respect for human rights, including the UN Guiding Principles and OECD MNE Guidelines, and target all companies (including sole proprietors) that conduct business activities in Japan.

United Kingdom

(30 August 2022) The Financial Reporting Council Lab published a report on ESG data production, designed to help companies consider how to collect and use ESG data more effectively to support better decision-making (the Report). The Report is the first phase of an FRC project on the production, distribution and consumption of ESG data, which was launched following the FRC's ESG Statement of Intent in 2021. The Report analyses findings from several interviews and roundtable discussions with a range of stakeholders and recommends a step-by-step approach across three key factors of data production: motivation, method and meaning.

Advocacy Group Publications


(30 September 2022) The International Corporate Governance Network published Viewpoint: The Governance of Sustainability: An Investor View of Board Effectiveness which considers the investor view of the board’s role in the creation and oversight of the company’s sustainability factors in meeting global investor expectations.

United Kingdom

(22 September 2022) The Glasgow Financial Alliance for Net Zero published a report entitled 'Expectations for Real-economy Transition Plans' outlining the components of transition plans that financial institutions will be looking for from companies. | Press release

(8 September 2022) Forty-seven companies signed a letter signalling their support for a new UK law mandating human rights and environmental due diligence (HREDD) for companies and investors. The letter notes that such a law would deliver on the government's commitment to the levelling up agenda and the transition to net zero, as well as bringing all companies to the same standard in terms of HREDD. This follows a letter signed by 39 investors, representing over £3.8 trillion in assets under management on 31 August, which similarly called for a law mandating companies to carry out HREDD across their own operations and value chains.

Clifford Chance Publications


Recordings (Recordings older than three months can be found on the Financial Markets Toolkit)

European Tech Perspectives Series

(12 July 2022) Digital Services Act: New rules for digital intermediaries

Global Financial Markets Perspectives Series 

Clifford Chance's Global Financial Markets Autumn Perspectives events programme is to resume with some in-person events in London, in addition to holding a number of sessions online. Guest speakers and experts from across the Clifford Chance network will discuss the following legal and business topics:

Please click here to view the full programme and here to register for your preferred sessions.