Key Themes

  • The global backdrop of the Extinction Rebellion has brought climate action back to the headlines. Recent times have seen a wave of endeavours by finance regulators to promote the importance of ESG matters, particularly those that relate to climate risk. This includes highlighting the systemic financial risks that can be created by climate change.
  • “Taxonomies” are becoming a thing. In this context, taxonomies relate to describing a class or classes of “sustainable”/ESG-compatible financial products. These can be used, for example, to help regulate the approach to “ESG-friendly” financial products, such as green bonds. The European Union is developing its own taxonomy of financial products.
  • Climate-related matters continue to occupy regulators, with the UK government legislating for “net zero” emissions by 2050 and several initiatives continuing to apply pressure in relation to carbon disclosure and systemic carbon-related risk.
  • Interest in ESG continues to spread geographically with more green / ESG bonds and financial products, and the HKSE consulting on ESG.