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Regulatory

ESG is challenging because there is no single piece of regulation that provides a clear framework within which to operate. The landscape is nuanced, complex, evolving rapidly and heavily influenced by stakeholder expectations and voluntary commitments and initiatives.

We help clients form a robust understanding of what their ‘ESG landscape’ looks like, including:

  • what ESG regulatory requirements you should be complying with;
  • what commitments and public statements you have made on ESG that you might be held to;
  • what soft law standards, frameworks or memberships you have signed up to (and what they require);
  • who your stakeholders are and what they expect of you; and
  • your key ESG risks and opportunities.

How Linklaters can help you

Understanding the evolving landscape and getting started

For business of all types, it is essential to build an understanding of the broad and rapidly ESG landscape and direction of travel and implications (direct and indirect) for the business. We have built a deep knowledge of the regulatory and policy drivers and we appreciate the business opportunities and challenges arising out of the growing focus on sustainability. This is thanks to our holistic view of ESG which integrates soft and hard law across a range of practice areas, a knowledge of market practice across multiple sectors and a global view of risk informed by our international footprint.

ESG disclosures and reporting

Numerous regulatory regimes and soft law standards have been introduced in recent years which ask businesses to collect data and report on an increasingly broad range of sustainability-related topics. Disclosure regimes can impact businesses directly and indirectly and can vary across jurisdictions creating challenges for global corporations and requiring a consistent and strategic approach to reporting. With further disclosure regimes on the horizon, this area is rapidly evolving.

We have a deep knowledge of the ESG-related disclosure regime and have advised clients on their application and compliance for a number of years. We help our clients understand what information needs to be disclosed and where, assist in identifying market trends and best practice and help align disclosures with business strategy and policy commitments. We also help clients navigate potential challenges and pitfalls such as ensuring disclosures are appropriately balanced, understanding hot button issues and areas of particular sensitivity, ensuring that risks and challenges and dependencies are clearly articulated, and cautionary statements and disclaimers are used appropriately.

Sustainable finance regulation

Having a broad, deep and multi-disciplinary understanding of the span of demanding and fast-paced regulatory reforms, we advise many buy-side, sell-side firms and corporates on the way in which the new and emerging regulatory requirements will impact their institutions and on the compliance programmes and dis-closures necessary to achieve compliance at both entity and product level. We are advising several large asset managers and investment funds on how to comply with the new requirements. Closely watching the development of detailed, technical standards in this space, and with strong links to many industry associations, we are able to provide rigorous legal analysis of legislation, rules and policy guidance with the ability to benchmark their practical implementation in the market. With contrasting regimes already in place or pro-posed in jurisdictions including the EU and the UK, our cross-practice capability enables clients to stay on top of reforms and develop practical implementation solutions.

As with every major area of regulatory reform, governance and control to embed it within an institution will be a core concern of the regulators. With our understanding of our clients’ existing organisational framework and governance structures, we are able to advise senior management teams on how responsibility for ESG risks and opportunities should be mapped, managed and harnessed across the institution.

Antitrust

We have a ESG antitrust team that has been at the forefront of thought leadership in the space and advises clients, including trade associations in various sectors, on cutting-edge ESG matters. Crucially, we can translate our extensive expertise and award-winning innovation across all areas of antitrust law into practical and dynamic solutions for clients both under the existing competition framework and the changes that will come as thinking in this space continues to evolve.

Employment & Incentives

Our Employment & Incentives team is a market-leader in helping clients navigate through the ever-increasing regulatory requirements and investor expectations to incorporate ESG considerations into workplace policies and reward design and disclosure. Our multidisciplinary team can support you with:

  • Regulatory remuneration: Our dedicated Incentives practice has steered numerous global firms through dramatic change in remuneration in the financial services sector and has worked with regulators to clarify and influence the practical application of the rules.
  • Regulatory employment: Our dedicated Employment practice regularly advises clients on the changing legal and regulatory landscape which has led to enhanced protection for whistleblowers and a corresponding expectation on organisations to implement effective whistleblowing arrangements. The need for robust whistleblowing arrangements, and the increased accountability of senior management for ensuring that those arrangements are fit-for-purpose, has only increased with the implementation of the new EU Whistleblower Protection Directive. We help employers not only with legal compliance, but also on how to “listen up” to what their staff say.
For more information on our Employment & Incentives team, visit our dedicated webpage.

 

Selected regulatory experience

A major global financial institution: Acting as ESG counsel to a major global financial institution, advising on the implementation of their ESG strategy, supporting them to navigate the regulatory, litigation and stakeholder landscape. The mandate combines our technical regulatory expertise with our ability to help frame climate-related topics for interactions with external stakeholders and has given us valuable insights into the ways in which NGOs and activist shareholders in particular are engaging with businesses.

Several leading asset managers: We have been assisting a few asset managers with a bespoke regulatory tracker on ESG regulations that apply to asset managers and their clients within the UK, Europe and other key jurisdictions in which the asset managers operate. The tracker is designed to enable the managers to anticipate the key impacts and timing / deadlines for ESG reforms that will impact their business, portfolio companies and clients in these regions.

Canada-based financial institution: Preparation of a bespoke regulatory tracker on ESG-related laws, rules and regulations in the UK and Singapore. This covered, among other things, materials stewardship, responsible sourcing, misleading marketing, treatment of customers, artificial intelligence, human rights, board diversity, political lobbying, ABC and AML. We also assisted with mapping how these laws, rules and regulations related to internal policies and procedures.

A major logistics company: undertaking both a general compliance and sustainability review exercise, comprised of a gap analysis against regulations and relevant standards, peer benchmarking exercise and making recommendations for next steps.

Bloomberg: acting as external antitrust counsel to the Glasgow Financial Alliance for Net Zero, the world’s largest coalition of financial institutions committed to transitioning the global economy to net-zero greenhouse gas emissions, with more than 500 members drawn from over 45 jurisdictions.

Investor membership body: advising on competition law aspects of ESG shareholder engagement collaboration.

Consumer Goods Forum: advising on an ongoing advice on various sustainability related issues.

Farfetch: advising on green claims compliance and the CMA’s guidance on green claims.

Numerous banks and investment firms: advising on the application of remuneration aspects of the Sustainable Finance Disclosure Regulation, including remuneration disclosures and underlying remuneration policies and process documents.

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