Daily ESG Briefing: EU consults on taxonomy rules for big firms and financial institutions

The latest developments in sustainable finance

The European Commission wants feedback on how large companies and financial institutions should disclose against the EU taxonomy. Proposed rules, known as 'Article 8' of the taxonomy regulation, were laid out in a draft delegated act on Friday and are subject to consultation until 2 June. They relate to firms covered by the EU’s Non-Financial Reporting Directive – due to expand under a new Corporate Sustainability Reporting Directive – and cover the content, methodology and presentation of information that large financial and non-financial undertakings should disclose. 

Retail investors in the UK are increasingly keen to invest their money responsibly, but are confused by current terminology, says research from Close Brothers Asset Management. Two thirds of investors surveyed were prioritising responsible investment over maximising returns, but familiarity with ESG lingo was low. Only a quarter of respondents knew what the Sustainable Development Goals were, and just 18% knew what SRI was. Familiarity with ESG terminology was highest among younger investors, and investors who used a financial advisor.

The UK Government aims to develop commercial frameworks to drive investment into Carbon capture, utilisation and storage technologies, known as CCUS. In a report on Friday, the Department for Business, Energy and Industrial Strategy said that the barriers to deploying CCUS projects were primarily commercial, and that its frameworks “will enable an appropriate and efficient allocation of risk and provide the confidence investors need”. The government has already committed to invest £1bn to support the development of CCUS in four ‘industrial clusters’. 

Standard Chartered is under fire for participating in a $400m loan to coal giant Adaro Indonesia – a deal which adds to the $31.4bn that NGO Market Forces claims the bank has provided to the fossil fuel sector since the Paris Agreement was signed. Adam McGibbon, UK Campaigner for the group, said: “We’re putting Standard Chartered on notice that if we don’t see improvement in their policies, we will table a shareholder resolution for next year’s AGM and seek investor support to force the bank’s leadership to properly address the climate crisis”.

BNP Paribas Asset Management has changed its tag line from “the asset manager for a changing world” to “the sustainable investor for a changing world”. It has registered 84% of its funds under Articles 8 or 9 of the EU’s new Sustainable Finance Disclosures Regulation and claims to have more than €90bn invested in sustainable, impact or SRI-labelled funds.