April News Highlights

6 May 2020

This month includes news from LuxSE, SET, B3, LSE, SZSE, JPX, Nasdaq, JSE and more. Monthly news highlights are compiled by the SSE to give an overview of the capital markets' sustainability news from that month. You can subscribe to our monthly news highlights by clicking here.

SSE INITIATIVE NEWS & EVENTS 

Save the Date: 7 December SSE 2020 Global Dialogue The SSE Global Dialogue is the main global platform for establishing the direction of travel for sustainable capital markets. Held once every two years, this is the SSE’s flagship event for capital market leaders. Preparations are being made for our December event to go ahead but of course we will monitor the ongoing Covid-19 pandemic and make adjustments to our plan as necessary. In meantime, monitor this webpage and our twitter account for latest updates.  Regulation and sustainability: SSE launches new database; IOSCO launches new report 16 Abril 2020 The Board of the International Organization of Securities Commissions published its report on Sustainable Finance and the Role of Securities Regulators and IOSCO, which seeks to help market participants address issues related to sustainability and climate change. In order to support securities regulators on how, within their existing mandates, they can act (and are acting) on sustainability-related risks and opportunities, the SSE recently launched a new interactive Securities Regulators Database to provide examples of how securities regulators are already contributing to the achievement of the Sustainable Development Goals. JPX publishes Practical Handbook for ESG Disclosure 31 March 2020 The Japan Exchange Group (JPX) and Tokyo Stock Exchange (TSE) announced the publication of a new Handbook to support listed companies who are choosing to work on  (Environmental, Social, Governance) ESG disclosure, linking their company's mid- to long-term corporate value improvement to its sustainable growth.  Exchange in Focus: LuxSE takes home ‘Exchange of the Year’ award for fourth consecutive year 01 April 2020 Since launching the Luxembourg Green Exchange (LGX) in September 2016, the world’s first and still unique platform dedicated solely to sustainable securities, LuxSE has continued to pave the way towards a more sustainable economy.

STOCK EXCHANGE NEWS

Shenzhen Stock Exchange Facilitates Innovation and Development of SMEs 13 April 2020 On April 10, a series of investment and financing matching activities for enterprises invested in by the National Small and Medium-sized Enterprises Development Fund were successfully launched. Five enterprises from the fields of artificial intelligence, advanced manufacturing and integrated circuit delivered online roadshows through the V-Next, SZSE’s Innovation and Entrepreneurship Investment and Financing Platform. The roadshows were available through live streaming. Over 300 investment institutions and listed companies participated in the online interaction. Nasdaq Waives Listing Fees for COVID-19 Response Bonds 03 April 2020 Due to the exceptional circumstances caused by the coronavirus outbreak, Nasdaq has decided to waive the listing fees of Covid-19 bonds on the Nasdaq bond markets in Copenhagen, Helsinki and Stockholm during 2020. The waiver applies to new bonds issued to explicitly and solely finance projects or assets that alleviate the negative economic or health consequences of the COVID-19 pandemic. The issuer must publically announce that the purpose of the bond in question is in line with the waiver requirements. LuxSE waives listing fee for COVID-19 response bonds 15 April 2020 The Luxembourg Stock Exchange (LuxSE) announced that it will waive the listing fee for social and sustainable debt instruments that are issued to address the consequences of the current coronavirus pandemic. Until 30 September 2020, the leading exchange for sustainable securities will refrain from charging a listing fee for social and sustainability bonds that are clearly identified as COVID-19 response bonds in the relevant documentation and eligible for display on the Luxembourg Green Exchange (LGX). With this move, LuxSE calls on exchanges across the world to support financing efforts to fight the pandemic and its overwhelming ramifications. London Stock Exchange Supporting Issuers of Social and Sustainability Bonds that Mitigate the Impact of the Covid-19 Pandemic 03 April 2020 Admission fees for social and sustainability bonds that aim to mitigate the impact of COVID-19 with relevant use-of-proceeds waived for 3 months. Applies to bonds that are admitted to London Stock Exchange, and meet the eligibility criteria for the Sustainable Bond Market’s social or sustainability segments. During this period of exceptional market volatility and global uncertainty due to the Coronavirus (COVID-19) pandemic, LSE takes its responsibility to ensure the orderly functioning of markets and continuity of services for its customers and other stakeholders very seriously.  SET launches relief package for its stakeholders to battle with COVID-19 outbreak March 2020 The measures are to lower fees, covering annual registrar fee for members of Thailand Securities Depository Co., Ltd. (TSD); annual fee for listed companies, limited to firms joining quarterly investor meetings, or Opportunity Day; membership fee for securities companies and  depository fee, representing THB 500 million value of aid in total. SET President Pakorn Peetathawatchai said the aid package aims to lessen financial burden, cut operating costs, and to boost business liquidity, to help Thai businesses through an economic shock due to the broad effects of COVID-19. JSE and the #Trade4Solidarity campaign 08 April 2020 The Johannesburg Stock Exchange (JSE) is to donate fees derived across all asset classes traded on Wednesday 15 April and Thursday 16 April as part of a brand-new campaign #Trade4Solidarity to the Solidarity Fund. The #Trade4Solidarity initiative encourages market participants to join the JSE by contributing a portion or percentage of their trading revenues to the fund. B3 launches social responsibility campaign to fight coronavirus 07 April 2020 B3, the Brazilian stock exchange, launched a social responsibility campaign to help minimize the effects of coronavirus in Brazil. Divided into four actions, the objective is to assist in the purchase of equipment for public hospitals and their health professionals; contribute to the distribution of hygiene baskets to families in situations of social and economic vulnerability, in addition to blood donation to blood centers. Also, B3 announced a series of easing measures in procedures and deadlines related to listing rules for listed issuers (public companies and funds).

REGULATOR NEWS

ESMA Issues New Q&A On Alternative Performance Measures In The Context Of Covid-19 17 April 2020 The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has issued a Q&A to provide guidance to issuers on the application of the ESMA Guidelines on Alternative Performance Measures (APM Guidelines) in the context of the COVID-19 pandemic. Securities Commission Malaysia Announces Series Of Capital Market Measures To Support Businesses 16 April 2020 The Securities Commission Malaysia (SC) today announced further reliefs for public listed companies (PLCs), and is considering additional measures to facilitate greater access to funding for small and midcap companies, as well as Micro, Small and Medium Enterprises (MSMEs). “With this Covid -19 pandemic, we are confronting a situation that none of us has experienced in our lifetimes. It requires measured responses that consider the longer term impact on our market and its participants, beyond this immediate crisis,” said Datuk Syed Zaid Albar, Chairman of the SC. The Finance authorities of the UAE have issued joint guidance for banks and finance companies 05 April 2020 The Authorities regulate and supervise banks and finance companies that may have clients experiencing financial stresses as a result of the Covid-19 outbreak. The Authorities are supporting both federal and local initiatives aimed at providing sustainable solutions to support borrowers who will be utilising government-sponsored debt relief programs at this time.  Japan's Financial Services Agency: Information On COVID-19 (Novel Coronavirus) 06 April 2020 Financial Services Agency (FSA) has made a leaflet for those facing difficulties with cash flow as impact of the ongoing COVID-19 epidemic spreads. UK Financial Conduct Authority Sets Out Priorities For 2020/21 07 April 2020 The Financial Conduct Authority (FCA) has today set out its business priorities for the year ahead with specific focus on the challenges presented by the coronavirus (Covid-19) pandemic.

ESG INDICES AND PRODUCTS

Coronavirus Bonds May Help Social Debt Emerge From Green Shadow 03 April 2020 Issuance of social and sustainable bonds has jumped as borrowers including the European Investment Bank and World Bank raise funds to help governments and companies weather the consequences of the global pandemic. Their efforts have also stoked a wider push to make it easier to measure the results of social bonds -- something that can seem more nebulous than for environment-focused green bonds. Who Put the ‘S’ in ‘ESG’ (and What Does It Mean)? 05 May 2020 The three pillars of so-called ESG investing have never been equals. The “E,” for environmental, has dominated the “S” for social and “G” for governance, reflecting concerns about climate change. Now, the coronavirus pandemic has given the S a big boost, with social bonds becoming the fastest-growing part of sustainable finance. Some of those bonds are earmarked for vaccine development or defraying crisis costs. But more broadly, there’s a new focus among investors on how companies treat their workers and how they benefit society. The risk of brand damage for companies seen as engaging in anti-social behavior has also increased.

CONSULTATION

Europe Commission: Consultation on the renewed sustainable finance strategy Consultation period extended to 15 July 2020 Building on the 2018 Action Plan on financing sustainable growth, the renewed sustainable finance strategy will provide a roadmap with new actions to increase private investment in sustainable projects and activities to support the different actions set out in the European Green Deal and to manage and integrate climate and environmental risks into our financial system. The aim of this public consultation is to collect the views and opinions of interested parties in order to inform the Commission's renewed strategy on sustainable finance.

RESEARCH 

Moody's Investors Service: Sustainable finance innovation to boost private investment in emerging markets, combating effects of coronavirus 06 April 2020 Recent multi-stakeholder initiatives seek to mobilise the private capital needed for sustainable infrastructure in developing countries. While MDBs' use of credit enhancements remains limited so far, this will grow as they seek to optimise their balance sheets and improve the risk-return profile of sustainable finance for emerging markets.  Morgan Stanley: Why the Coronavirus Puts a New Lens on ESG Investing 06 April 2020 Even before the coronavirus outbreak, more investors were looking at companies through the lens of environmental, social and governance (ESG) practices. But now, corporate decisions on human capital, customers and society during the COVID-19 pandemic could carry greater weight. As companies face greater scrutiny during the crisis, ESG factors will now be a key layer of diligence in evaluating an investment. Nasdaq: Markets Enter The Eye of the Coronavirus Storm 02 April 2020 The past month has been pretty extraordinary. But there are signs that the market is starting to act more rationally and waiting on new data to see whether valuations are oversold, or need to be ratcheted down some more. That’s evident from the fact that the market has not sold off much on days with decidedly bad economic data, like the record 3.3 million weekly unemployment claims March 26, the 6.65 million April 2, and the significant drops in Purchasing Managers’ Indexes (PMIs) now being published. That shows the market has already priced in a lot of bad news. Even a poor upcoming earnings season is now “expected,” although forward-looking comments will be important to some companies and industries.  

MANAGEMENT NEWS

Morningstar to Acquire Sustainalytics and Expand Access to ESG Research, Data, and Analytics for Investors Worldwide 21 April 2020 Two firms will join forces to empower all types of investors to drive long-term, meaningful outcomes that contribute to a more just and sustainable global economy. Morningstar currently owns an approximate 40% ownership stake in Sustainalytics, first acquired in 2017, and will purchase the remaining approximate 60% of Sustainalytics shares upon closing of the transaction. 

About the SSE

The SSE initiative is a UN Partnership Programme organised by UNCTAD, the UN Global Compact, UNEP FI and the PRI. The SSE’s mission is to provide a global platform for exploring how exchanges, in collaboration with investors, companies (issuers), regulators, policymakers and relevant international organizations, can enhance performance on ESG (environmental, social and corporate governance) issues and encourage sustainable investment, including the financing of the UN Sustainable Development Goals. The SSE seeks to achieve this mission through an integrated programme of conducting evidence-based policy analysis, facilitating a network and forum for multi-stakeholder consensus-building, and providing technical assistance and advisory services.