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Bite-size Briefings: Environmental, Social and Governance (ESG) regulation

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A series of briefings that take a bite-size look at international trends in different jurisdictions, drawing on Baker McKenzie’s expert financial services practitioners with local market knowledge.

This edition takes a bite-size look at the different rates of progress of environmental, social and governance (ESG) regulation and voluntary standards across the European Union, Hong Kong SAR, Japan, Singapore, the United Kingdom and the United States. The 2015 Paris Agreement on Climate Change specifically identified finance as having a key role in mitigating the effects of global warming, as large-scale investments are needed to significantly cut emissions. Nor, of course, are financial institutions themselves immune from the effects of climate change, as their prudential soundness and ability to meet long-term commitments will be jeopardized if the value of their capital is impacted. The COVID-19 pandemic has provided a significant impetus to the adoption of ESG regulation and voluntary standards, although the industry’s progress is being slowed by a lack of common and consistent international standards over disclosure and classification. What was, initially, (largely) voluntary is becoming essential to win business and is, increasingly (especially in Europe), subject to legal and regulatory imperative, as exemplified by the number of jurisdictions proposing to make mandatory the Task Force on Climate-related Financial Disclosures (TCFD).

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Karen Man is a partner in Baker McKenzie’s Financial Services group, leading the non-contentious Financial Services Regulatory practice. Her clients include global, Chinese and local banks, fund managers, brokers/dealers, money service operators and fintech firms. Karen is admitted to practice in Hong Kong, the UK, and Australia.

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Akiko Hosokawa has approximately 20 years of experience assisting clients in various banking and finance and general corporate matters. Prior to joining Baker McKenzie, Akiko worked for a major Japanese insurance company. She has been a partner since January 2006. She has experience working at Baker McKenzie’s London office, and was seconded to Goldman Sachs (through the London office) and the Financial Services Agency of Japan. She is an adjunct financial law instructor at the University of Tsukuba Law School since 2010 and is also a visiting professor at Chuo University's Graduate School of Strategic Management from 2012 to 2016. She has co-authored several publications related to her field, including Basis and Operation of the New Trust Law in 2007.

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Jennifer L. Klass serves as the co-chair of Baker McKenzie's North America Financial Regulation and Enforcement Practice, which provides clients with a full range of regulatory advice and enforcement counseling. Jen is an experienced financial services regulatory lawyer with particular focus on investment adviser regulation and the convergence of investment advisory and brokerage services. She regularly represents clients before the US Securities and Exchange Commission (SEC), both in seeking interpretative guidance and in managing examination and enforcement matters.

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Amy serves as the Co-chair of Baker McKenzie's North American Financial Regulation and Enforcement Practice, which provides our clients with a full range of regulatory advice and enforcement counseling. Amy also serves on the steering committees of the Firm's Global Financial Services Regulatory and Global Financial Institutions Groups. Previously, Amy has served as chief litigation counsel at the US Securities and Exchange Commission's (SEC) Philadelphia regional office and managed a team of lawyers overseeing a wide variety of enforcement matters.

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Caitlin McErlane is a partner in Baker McKenzie’s Financial Services & Regulatory Group in the London office. Caitlin's practice focuses on advising a range of global financial institutions on complex and high value regulatory matters. She advises banks, major corporates, payment institutions and asset managers on navigating UK and EU financial services regulation. She has particular experience in advising clients on regulatory implementation projects, day-to-day compliance issues, and regulatory issues arising in the context of large-scale transactions. She also expertise in the areas of banking and wholesale financial markets regulation, in particular in the FX and fixed income space, alongside experience advising market infrastructure providers, including major international exchanges, trading platforms, clearing systems and payment services providers, on a variety of compliance issues. Caitlin is also a member of the Baker's ESG and sustainability taskforce, and advises a range of clients on the drafting and implementation of ESG policies and the implications of becoming a signatory to the UNPRI and the Stewardship Code. Caitlin is an authority on regulatory reforms in the sustainability space and sits on a number of trade association working groups. She has recently been interviewed by Climate Action on her work and is a frequent speaker on the subject.

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Wataru Inagaki is a member of the Banking & Finance group in Baker McKenzie's Tokyo office. Prior to joining the Firm, he worked for a law firm focusing on domestic corporate law.

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Olivier Van den broeke is a senior associate in the Financial Services Regulatory & Insurance Practice Group in the Antwerp office. He joined Baker McKenzie in 2013.

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Kimberly Everitt is Baker McKenzie's knowledge lawyer for Financial Services Regulation & Enforcement, covering the EMEA region, and brings over a decade of experience to the team in both knowledge and fee-earning roles. Prior to joining Baker McKenzie, Kim held roles specializing in contentious financial services regulation knowledge, and her fee-earning roles covered non-contentious regulation in the private equity and general financial services sectors.

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John F. Lawlor is an attorney in the North America Banking, Finance and Major Projects Practice Group in Baker & McKenzie's Chicago office. Mr. Lawlor has experience representing lenders and borrowers in many types of complex financings, including senior and subordinated debt, secured and unsecured, investment grade and non-investment grade debt financings and cross-border financings.

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