Non-financial regulations are rapidly multiplying!
The prospect of the SEC creating a US regulation on ESG topics is ever clearer. China and the European Union are seeking to align their green taxonomies. The idea of a social taxonomy is finally on the table for the European Union, together with the International Platform for Sustainable Finance...
The list of initiatives and varied expressions of political will to better integrate climate or social risks is expanding. This is undoubtedly good news. No doubt will readability and comparability be recognized as necessary conditions for progress on the major socio-environmental issues of the decade ahead. That said, in and of themselves, they remain insufficient.
Could this mean a global convergence on ESG performance by 2025, in such a way that it would be immediately understandable and comparable from one continent to another? Let's hope so. Yet the road is long and winding! Even in the European bloc, the presumed leader in sustainable finance, only 20% of the activities in the DJ Eurostoxx 50 index are eligible to the green taxonomy. Just 2% indexed companies’ consolidated revenues are actually on point. This is perhaps a fairer reflection of the state of our economies. The necessary transformation is massive for us to collectively act on climate change, protect biodiversity and restore social relations.
The DWS scandal is stark reminder to all asset managers and companies that non-financial information is increasingly closely scrutinized. It is therefore key to improve its robustness. Above all, a major inflexion point lies in the rigor with which programs aimed at financing the energy or circular transition – as much as inclusive growth. It all comes down to sound foundations and robust indicators.
To that very end, collective efforts must be geared first and foremost towards the emergence of solutions, not merely risk management performance. We need to think beyond ESG. Build global solutions that make a positive contribution. Enable companies and investors to consolidate and legitimize their activities.
In our blog this month :A European duty of care is gradually coming to the fore, particularly in light of the latest components of the European Green Deal – namely, the Green Taxonomy and the Sustainable Finance Reporting Directive (SFRD). Meanwhile, various approaches to Human Rights due diligence are emerging at in the private sector, on a national as well as a multilateral level. In this article, Ksapa lists 5 key principles to implement effective due diligences.
As part of a guide on impact investing and CSR due diligence, Ksapa outlines a couple keys to better integrating these developments into the private equity universe. Check out the interview on our website.
In this webinar, Ksapa will explore the key challenges and practical solutions in building resilience across sensitive commodity supply chains. Register nowand join us on October 26 at 5PM (Paris) | 11AM (New York City) | 4PM (London).
