14 December 2023

7 min read

ESG Watch | December 2023

December 2023
Aerial shot of a bridge over a river with green trees


Key news in this edition:

  • The UK Financial Conduct Authority (FCA) confirms sustainability disclosure and labelling regime to tackle ‘greenwashing’.
  • Singapore launches digital platform for simplifying ESG data collection and access.
  • Brazilian government presents fund for the preservation of tropical forests.

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The EU Parliament reaches a provisional agreement for the implementation of the New Nature Restoration Law 

On 9 November, the EU Commission welcomed the provisional agreement reached between the EU Parliament and the EU Council on the Nature Restoration Law, a piece of legislation that would mandate EU countries to restore at least 20 percent of the EU’s land and seas by 2030. The prospective adoption of the Nature Restoration Law arises from the EU’s growing concerns regarding the economic costs of nature degradation, as it seeks to restore ecosystems and biodiversity.

The Nature Restoration Law, considered by EU lawmakers to be one of the key potential contributors to reaching climate neutrality by 2050, was first adopted as a proposal by the EU Commission on 22 June 2022. While no official dates have been agreed, the EU Commission expects that the EU Parliament and the EU Council will imminently formally adopt the law, which would then enter into force within 20 days. Following its formal adoption, EU states would be obliged to submit their first nature restoration plans to the EU Commission within two years.

The UK Financial Conduct Authority (FCA) confirms sustainability disclosure and labelling regime to tackle ‘greenwashing’

On 28 November, the FCA proposed a new package of sustainability measures to help investors make more informed decisions and better navigate the market for sustainable investment products. According to the new measures, the FCA will introduce: product labels to help investors understand what their money is being used for; naming and marketing requirements so products cannot be described as having a positive impact on the environment where they do not; and an anti-greenwashing rule requiring all sustainability-related claims made by FCA-authorised firms to be fair, clear, and not misleading. The measures will come into effect from 31 May 2024.

Asia Pacific

Hong Kong sets standards for sale of green and sustainable investment products   

On 29 November, the Hong Kong Monetary Authority (‘HKMA’), the city’s central banking institution, issued a circular on the standards for sale of green and sustainable investment products by registered institutions in Hong Kong. On product due diligence, institutions should “take reasonable steps in classifying products as green and sustainable”, and ongoing product due diligence should be conducted in “appropriate intervals”. Institutions should notify customers when the product no longer meets the criteria to maintain its green and sustainable status. The circular also includes expected practices on governance and controls, staff training, disclosure, customer’s sustainability preference and book building activities. The HKMA requires all registered institutions to comply with the standards within 12 months after the circular was issued.

Singapore launches digital platform for simplifying ESG data collection and access 

On 16 November, the Monetary Authority of Singapore (‘MAS’) launched a digital platform for both the financial sector and real economy to collect and access ESG data. MAS expects the system will help companies automate their ESG reporting process, and allow financial institutions, regulators and large corporates to access data to support their sustainability-related decision making. To achieve this, the platform will pursue integrations with multiple “digital systems employed by businesses in their day-to-day activities”, and “translate and compute” source data into ESG-related outputs for businesses to report. Businesses will also have the discretion to decide who to share their ESG information with. The system is undergoing live testing with selected banks and SMEs, and will be progressively rolled out from Q1 2024 onwards.

Russia and CIS

Turkmenistan signs global methane pledge

On 1 December, during the 28th United Nations Climate Change Conference (COP28) held in Dubai, Turkmen President Serdar Berdimuhamedov announced that Turkmenistan joined the Global Methane Pledge, a global commitment made by 155 countries to reduce worldwide methane emissions by 30 percent by 2030 from 2020 levels. Berdimuhamedov added that the Turkmen government approved its nationally determined contributions (NDC) to the Paris Climate Agreement to achieve a 20 percent reduction in overall greenhouse gas emissions by 2030, compared with 2010 levels.

Turkmenistan is one of the world’s largest methane emitters. According to satellite data analysed by UK publication The Guardian earlier this year, during 2022, methane emissions from two of Turkmenistan’s largest oil and gas fields caused more global heating than the entire carbon emissions of the United Kingdom. Others have criticised the Turkmen government’s COP28 announcement as the “lowest possible hanging fruit” for the country’s climate targets. 

Kazakhstan signs green energy agreements during COP28

The government of Kazakhstan signed 20 different agreements and documents on digitisation, green energy and infrastructure projects with the government of the UAE and UAE-based companies during COP28 in Dubai. From a perspective of the future of green energy in Kazakhstan, five of these agreements are the most important. These include three agreements on the development of wind power plants, one of which includes a battery energy storage system, several low carbon energy projects in Kazakhstan, and an agreement between the nuclear energy company of Kazakhstan, Kazatomprom, and Emirates Nuclear Energy Corporation for the supply of natural uranium concentrates to the UAE. These agreements indicate a significant step away from the use of fossil fuels in the Kazakh energy network and a transition towards renewable and low carbon energy sources. In 2020 Kazakhstan pledged to be climate neutral by 2060.

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South America

Brazilian government presents fund for the preservation of tropical forests 

At the 28th UN Climate Change Conference (COP28), the Brazilian government introduced a GBP 198 billion global fund for tropical forest conservation, aiming to benefit 80 countries. The initiative, presented by Minister Marina Silva, proposes a mechanism that provides returns for developed countries contributing to forest preservation. Details will be collaboratively developed with other nations, targeting completion by COP30 in 2025. Eligibility criteria include low or decreasing deforestation, and payments will be annually divided per hectare among eligible countries. The initiative also includes an ecological transformation plan, focusing on sustainable development and potentially generating 7.5 to 10 million jobs. 

UK announces new donation to the Amazon Fund

On 4 December, the Brazilian Ministry of Environment and Climate Change announced that the UK pledged GBP 35 million to the Amazon Fund during COP28 in the UAE, bringing its total contribution to GBP 115 million. The donation aims to support anti-deforestation efforts and sustainable use of the Legal Amazon. In 2023, other countries, including the US and Germany, also committed substantial donations, totaling around GBP 599 million. The Amazon Fund, revitalised in January 2023, has funded 106 projects, investing GBP 291 million to benefit communities, indigenous territories, and conservation units.

ESG Watch is S-RM’s round-up of the latest regulatory and policy updates relating to ESG from around the globe.

To discuss these articles or other related developments in ESG, please reach out to one of our experts.


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