FCA publishes updated ESG Strategy

Written by Zhuan Faraj

On 3 November 2021, coinciding with Finance Day at COP 26, the FCA published its ESG Strategy, setting out the outcomes the FCA wants to achieve and the strategic themes and key actions it expects to take to deliver these.

The FCA’s strategy is based on five core themes:

• Transparency – promoting transparency on climate change and wider sustainability along the value chain
• Trust – building trust and integrity in ESG-labelled instruments, products and the supporting ecosystem
• Tools – working with others to enhance industry capabilities and support firms’ management of climate-related and wider sustainability risks, opportunities and impacts
• Transition – supporting the role of finance in delivering a market-led transition to a more sustainable economy
• Team – developing strategies, organisational structures, resources and tools to support the integration of ESG into FCA activities

While these outcomes will be pursued over multiple years, the FCA has identified a number of interim milestones in the coming period. It will monitor progress against its commitments, measure the success of its interventions, and provide interim updates as part of its Business Plan and Annual Report in 2022, with a more detailed stock-take on progress in 2023.

The ESG Strategy may be of particular interest to listed companies and their advisors, regulated financial services firms, trade associations, interest groups, civil society and academics, professional services firms and other service providers, and Government and other regulators.

The ESG Strategy can be read in full here. Further details about Burges Salmon’s Sustainable Finance practice can be found here.