Due to the increasing awareness of the importance of environmental, social, and governance ("ESG") initiatives, the European Commission came forward at the end of May 2018 with a proposal related to this topic. The proposal is intended to reorient capital flows toward sustainable investments, manage financial risk stemming from climate change, and foster transparency and a long-term outlook for the financial economic activity.
Other similar initiatives are underway around the world, creating a quickly evolving regulatory landscape. Financial market participants should take note.
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