Katten ESG Guidepost is a monthly publication highlighting the latest news, legal and regulatory developments involving environmental, social and governance matters.

To read more issues of Katten ESG Guidepost, please click here.

EU to Ban Carbon Offset Claims Entirely?

By Chris Cole

Responding to pressure from activists who have argued that "[c]arbon neutral claims are greenwashing, plain and simple," the European Parliament and Council have reached a provisional agreement to ban all carbon-neutral claims in member states. If the Parliament approves the deal, member states will have 24 months to enact legislation to implement it. So, a new set of laws could become effective in 2026. Corporations will have some lead time to come into compliance. Read about the provisional agreement.

Latest Transatlantic Developments Webinar: Compliance With and Potential Risks of Climate Disclosures for Private and Public Companies

Presented by Katten

Katten will present "Latest Transatlantic Developments Webinar: Compliance With and Potential Risks of Climate Disclosures for Private and Public Companies" at 12:00 p.m. (ET) on Tuesday, December 5. Presenters Chris Cole, partner and chair, Advertising, Marketing and Promotions; Neil Robson, Financial Markets and Funds partner; Alexa Rollins, Capital Markets associate; and Brigitte Weaver, Employment Litigation and Counseling senior associate, will discuss the need for private and public companies to start assessing their climate footprints and making public disclosures under new laws and guidance that are going into effect soon. These requirements will expose environmental, social and governance (ESG) backsliders to public scrutiny and litigation and make "greenhushing" difficult. While some companies are going quiet on public pronouncements regarding ESG, they increasingly recognize the need to make progress on ESG metrics. Register for the "Latest Transatlantic Developments Webinar: Compliance With and Potential Risks of Climate Disclosures for Private and Public Companies" webinar.

(mis)Conduct, Money & Reputation Podcast Explores 'DWS, Sustainability & Disclosure'

Hosted by Neil Robson

ESG, specifically sustainability, is an increasingly controversial topic for investment managers, with diverging regulation in Europe, the US and the UK, and rising numbers of reputational hazards to navigate. Many fund companies are removing phrases like "ESG" and "sustainable" from product names while downgrading these funds' obligations to the principles of ESG. At the same time, many investment businesses have been overstating their sustainability credentials, and at least two firms have been fined over $25 million in recent years for making false claims.

In this latest (mis)Conduct, Money & Reputation podcast episode, Katten's Neil Robson, Lansons Asset Management Lead David Masters and Lansons ESG Lead Sam Sharpe explore the increasingly widespread issue of misconduct surrounding ESG, from the companies that have fallen afoul of the regulations and the regulatory trends, to the challenging act of maintaining a good reputation in an environment where ESG appears to have as many detractors as it has advocates. Read about this (mis)Conduct, Money & Reputation podcast episode.

Reuters, CityWire Wealth Manager Talk With Nathaniel Lalone on the UK FCA's Concerns for Fund Sustainability Labeling

Nathaniel Lalone shares his thoughts with Reuters, CityWire Wealth Manager, among others, on a report from the UK Financial Conduct Authority (FCA) indicating that numerous retail investment funds lack accuracy in labeling their sustainability features. This comes as trillions of dollars have been invested in funds emphasizing their environmental, social, and governance (ESG) credentials, raising concerns among regulators about 'greenwashing.' Nate indicated that trusting sustainable funds is critical for reaching Britain's net-zero targets. "This report shows that while progress has been made, much work remains to be done. Market participants should be prepared for the FCA to have little patience for poor behaviors in this space." Read about Nate's comments.