Answer ... In general, there is a trend towards greater regulation of ESG issues in Chile. In this regard, recently approved Law 21,455 imposes climate change disclosure obligations on investment projects, as well as on companies regulated by the CMF or the Pensions Superintendency. This law also sets out emissions standards for greenhouse gases.
The Water Code was recently modified to introduce the possibility of constituting water rights for environmental conservation purposes. Among other goals, this reform aims to foster private initiatives for the development of environmental conservation projects, either as compensatory measures for environmental impacts or as part of sustainable development plans.
In terms of governance, there is likewise continuous progress towards stricter requirements, especially in relation to disclosure and ESG reporting. As from 2022, the CMF requires the submission of ESG compliance information as part of companies’ mandatory financial reporting. This obligation will apply progressively to all companies according to their equity. In labour matters, since 2018, companies with more than 100 employees have been required to ensure that their labour force includes at least 1% of employees with disabilities.
In relation to the environmental assessment of investment projects, both the administrative agencies and the courts have progressively included, through administrative resolutions and jurisprudence, new considerations relating to climate change, water availability and respect for local traditions, among other things.
Law 20,393 on the criminal liability of legal entities is continually updated. It now includes in its catalogue of crimes conducts relating to arms control, human trafficking and cybersecurity.
In September 2022, the draft of a new constitution was rejected through a democratic plebiscite. However, it is expected that the constitutional discussion will continue, and that in the near future a new constitution which strengthens Chile’s ESG regulatory framework will be enacted.