ESG in Italy - Embracing sustainability

ESG has grown as a central topic in the agendas of major organisations, worldwide as in Italy.

Linklaters advises the Joint Lead Managers on Europe’s first ever general purpose SDG linked bond

The discussions on such themes is indeed “hot”, but what are organisations really doing to this end? A practical response to such themes is not always easy to be found, as a lack of proper guidance makes it hard for companies to direct investments to specific ESG targets.

  • Is this lack going to jeopardise a real shift by decision makers in this direction?
  • What do good practices look like, and how do you achieve tangible results?

Our new video collection, which goes hand in hand with the Firm’s attention to embrace sustainability and recognise and address environmental, social and governance risks, tries to respond to all these questions. We interviewed major experts from major companies in the Italian landscape by asking where they are right now and where they are going.

What’s on the horizon - legal and regulatory developments

January 2021

The EU's new Conflict Minerals Regulation
  • On 1 January 2021 a new law came into full force across the EU – the Conflict Minerals Regulation.

It aims to help stem the trade in four minerals – tin, tantalum, tungsten and gold – which sometimes finance armed conflict or are mined using forced labour.

Letter to EU commission on priority issues relating to SFDR application
  • On 7 January 2021 the ESAs sent a letter to the EU Commission requesting urgent clarifications on certain priority questions pertaining to the SFRD to facilitate an orderly application of the regulation from 10 March 2021.

February 2021

ESAs delivered draft RTS under SFDR to the Commission
  • On 4 February 2021, the Joint Committee of the three European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) delivered to the European Commission the Final Report, including the draft Regulatory Technical Standards (RTS), on the content, methodologies and presentation of disclosures under the EU Regulation on sustainability-related disclosures in the financial services sector (SFDR).
European Commission’s consultation on sustainable corporate governance
  • In October 2020, the European Commission launched a consultation on sustainable corporate governance. The consultation closed on 8 February 2021 and a draft legislative proposal is expected in Q2 2021. This initiative aims to improve the EU regulatory framework on company law and corporate governance. It would enable companies to focus on long-term sustainable value creation rather than short-term benefits. It aims to better align the interests of companies, their shareholders, managers, stakeholders and society. It would help companies to better manage sustainability-related matters in their own operations and value chains as regards social and human rights, climate change, environment, etc.
Discussion Paper on management and supervision of ESG risks for credit institutions and investment firms (EBA/DP/2020/03)
  • The EBA’s consultation on its Discussion Paper on management and supervision of ESG risks for credit institutions and investment firms ended on 3 February 2021. The Discussion Paper provides a comprehensive proposal on how ESG factors and ESG risks could be included in the regulatory and supervisory framework for credit institutions and investment firms.
Joint ESA Supervisory Statement on the application of the Sustainable Finance Disclosure Regulation
  • On 25 February, the ESAs published a Joint supervisory statement on the effective and consistent application and national supervision of SFDR. The ESAs recommend the draft RTS be used as a reference when applying the provisions of the SFDR in the interim period between the application of SFDR as of 10 March 2021 and the application of the RTS at a later date.

March 2021

Taxonomy DA on Transparency of undertakings in non-financial statements - ESAs final advice
  • On 1 March, the ESAs sent to the Commission their final reports on the Taxonomy Delegated Act on Transparency of undertakings in non-financial statements (under Art. 8 Taxonomy Reg).
ESAP: Commission consultation closes
  • The consultation on the establishment of a European single access point (ESAP) for financial and non-financial information publicly disclosed by companies will end on 3 March 2021. The purpose of the targeted questionnaire is to seek general and technical views on the way to establish a European single access point (ESAP) for companies’ financial and sustainable investment-related information made public pursuant to EU legislation.
CONSOB warning notice and Q&A on the disclosures obligations on sustainability in the financial services sector
  • On 4 March 2021, CONSOB published: (i) a warning notice concerning the SFDR, whereby it called upon FMPs and FAs to incorporate a description of the measures taken and the controls carried out to comply with the provisions of the SFDR into periodic reports submitted to CONSOB pursuant to Resolution no. 17297/2010; and (ii) the first version of its Q&A on the SFDR.
The Sustainable Finance Disclosure Regulation (Regulation (EU) 2019/2088)
  • Most provisions of the Sustainable Finance Disclosure Regulation entered into force on 10 March 2021.

    The Regulation lays down sustainability disclosure obligations for manufacturers of financial products and financial advisers toward end-investors. In addition, the co-legislators added disclosure obligations as regards adverse impacts on sustainability matters at entity and financial products levels, i.e. whether financial market participants and financial advisers consider negative externalities on environment and social justice of the investment decisions/advice and, if so, how this is reflected at the product level.
Bank of Italy statement on the disclosures obligations on sustainability in the financial services sector
  • On 17 March 2021, the Bank of Italy published a statement on the SFDR where it shared the view taken by the ESAs in their Joint Supervisory Statement of 25 February 2021 on the early compliance with the level 2 provisions during the interim period from 10 March 2021 (i.e., the date of application of the SFDR) until the entry into force of the RTS.
Joint consultation on taxonomy-related sustainability disclosures
  • On 17 March 2021, the ESAs published a consultation paper with an updated version of the draft SFDR RTS (updated from the version included in the previous 4 February SFDR Final Report) – but this time to include Level 2 provisions proposed under the Taxonomy Regulation regarding disclosures of financial products investing in economic activities that contribute to an environmental investment objective.

April 2021

Commission’s review of the NFRD (Directive (EU) 2014/95)
  • The Directive – which amends accounting directive 2013/34/EU - lays down the rules on disclosure of non-financial and diversity information by large companies which were required to include non-financial statements in their annual reports from 2018 onwards.

    On 27 May 2020, the European Commission, in its Adjusted Commission Work Programme indicated the first quarter of 2021 as target delivery date for the review of the NFRD.
Delegated Acts on ESG preferences under MiFID, UCITS and AIFMD

The Commission is expected to adopt the Delegated Acts on ESG preferences under MiFID, UCITS and AIFMD in April.

May 2021

Renewed Strategy on Sustainable Finance
  • The Commission is expected to adopt the Renewed Strategy on Sustainable Finance in May 2021.

Coming months

New Corporate Governance Code
  • In January 2020 the new Corporate Governance Code was approved. It will apply to listed companies adopting the code from the first financial year starting after 31 December 2020, while the relevant disclosure shall be provided in the corporate governance report to be published during 2022.
Transposition of the SHRD II in Italy
  • The implementation of Directive EU 2017/828 (“SHRD II”) in Italy took place first with Legislative Decree no. 49 of 10 May 2019 and then with Legislative Decree no. 84 of 14 July 2020. At a secondary law level, in 2019 and 2020 CONSOB and, for certain aspects, the Bank of Italy launched market consultations, now closed, on proposed changes to their existing regulations regarding, in particular, remuneration’s transparency, asset managers and shareholders’ activism as well as shareholders’ identification, transmission of information and exercise of rights of listed companies’ shareholders. These changes will be effective gradually in 2021.
Sustainable corporate governance Initiative: Commission adoption
  • The European Commission is expected to publish a legislative proposal on sustainable corporate governance. Its adoption is planned for Q2 2021. It envisages, among others, to impose an obligation on companies operating in the EU to undertake mandatory human rights and environmental due diligence in their global operations and supply chains.
EU Green Bond Standard: Commission proposal
  • According to the 2021 Commission Work Programme, the legislative proposal is scheduled to be delivered in Q2 2021.
2019-2020 European Delegation Law
  • The Italian Parliament is currently discussing the 2019-2020 European Delegation Law which mandates the Italian Government to implement a set of European directives, including directive (EU) 2018/2001 on the promotion of the use of energy from renewable sources, directive (EU) 2019/883 on port reception facilities for the delivery of waste from ships, directive (EU) 2019/904 on the reduction of the impact of certain plastic products on the environment, directive (EU) 2019/944 on common rules for the internal market for electricity, directive (EU) 2019/1152 on transparent and predictable working conditions in the European Union, directive (EU) 2019/1161 amending Directive 2009/33/EC on the promotion of clean and energy-efficient road transport vehicles.

LinkChat: 5 minutes with…

Episode 1

Paolo Bertolini, our head of public law, interviews Giovanna Giusti del Giardino, Head of Group Sustainability, Mediobanca Group. The interview, conducted in Italian, focuses on human rights, environment and sustainability and aims to cover, in a nutshell, what Mediobanca is doing to such extent.

Watch now >

Episode 2

Paolo Bertolini, our head of public law, interviews Giulia Genuardi, Head of Sustainability Planning and Performance Management, Enel. The interview, conducted in Italian, focuses on the hardship of balancing social/environmental aspects with commercial needs and the relevance of circular economy.

Watch now >

Episode 3

Linda Taylor, our co-head of Italian ESG practice, interviews Nicole della Vedova, Head of Corporate Finance, Enel. The interview focuses on Enel’s journey in the sustainable finance market and on sustainability-linked bonds. 

Watch now >

Episode 4

Linda Taylor, our Co-Head of the ESG group in Italy, in a conversation with Enrico Camerini, Director, Head of Institutional Clients of iShares Italia, BlackRock, explores the initiatives put in place by BlackRock and the direction of investments towards financial products with ESG characteristics.

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Episode 5

In light of the imminent entry into force of Regulation 2019/2088 (the "SFDR Regulation"), our Financial Regulation Managing Associate Samuele Manfredo Pio interviews Roberta Casali, Chair of the Board of Directors of Tages Capital SGR S.p.A., an Italian asset management company that manages infrastructure funds with a focus on renewable energies, currently the second largest photovoltaic operator in Italy.

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Episode 6

Paolo Bertolini, Head of Public Law and member of the ESG working group of Linklaters, interviewed Silvia Mazzanti, product and sustainability manager of Save The Duck S.p.A., on their views on sustainable corporate governance and supply chain due diligence.

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Episode 7

In view of the imminent legislative interventions that the EU institutions should adopt on sustainable corporate governance and supply chain due diligence, Lucia Ciocarlan, Managing Associate and member of the ESG working group of Linklaters, interviewed Daniela Fiorentino, partnership specialist of UNICEF, currently involved in some projects in Ghana.

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Episode 8

Laura le Masurier, managing associate and member of the ESG working group of Linklaters, has interviewed Federica Calvetti, Head of ESG in EMEA at Deutsche Bank, on the growing interest in sustainable finance.

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Episode 9

As sustainability-linked financing transactions gain momentum in the Italian market, Lucia Ciocarlan and Benedetta Marino, managing associates and members of the ESG working group of Linklaters, have interviewed Francis Ravano, Head of Structured Finance at ERG S.p.A., on aspects related to Key Performance Indicators used by ERG for such type of transactions and the benefits resulting from implementing sustainable finance solutions in general.

Read now >

Episode 10

Laura Le Masurier and Marta Fusco, members of the ESG working group of Linklaters, interviewed Sergio Molisani, Finance, Insurance and Tax Director & Senior Vice President International Assets at SNAM S.p.A., on SNAM's strategy in the field of sustainable finance.

Read now >


Welcome to Linklaters Italy's ESG GEMS, a monthly update on ESG issues that brings to your attention the most relevant topics in the Environmental, Social and Governance area.

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