Global Trustee and Fiduciary Services Bite-Sized Issue 10 2023

Global Trustee and Fiduciary Services Bite-Sized | Issue 10 | 2023 6 QUICK LINKS CBDC DIVERSITY & INCLUSION FINTECH FUND LIQUIDITY OPERATIONAL RESILIENCE SUSTAINABLEFINANCE/ESG ASIA EUROPE LUXEMBOURG NORTH AMERICA UNITED KINGDOM Guidelines on the Application of Article 4(1) and (2) of the NIS 2 Directive On 18 September 2023 the European Commission Guidelines on the application of Article 4(1) and (2) of Directive (EU) 2022/2555 (NIS 2 Directive) was published in the Official Journal of the European Union. The Guidelines clarify the application of those provisions, which concern the relationship between the NIS 2 Directive and current and future sector-specific Union legal acts addressing cybersecurity risk-management measures or incident reporting requirements. The Appendix to the Guidelines lists the sector-specific Union legal acts that the Commission considers fall within the scope of Article 4 of the NIS 2 Directive. Currently only the Digital Operational Resilience Act (Regulation (EU) 2022/2554) is included in the Appendix. The fact that an act is not listed in that Appendix does not necessarily mean that it does not fall within the scope of that provision. Link to the Guidelines here SUSTAINABLE FINANCE/ESG ESMA TRV Risk Analysis Report – ESG Names and Claims in the EU Fund Industry On 2 October 2023 the European Securities and Markets Authority (ESMA) published a Trends, Risk and Vulnerabilities (TRV) Risk Analysis Report on ESG Names and Claims in the EU Fund Industry (the report). ESMA found that funds increasingly use ESG-related language in their names, and that investors consistently prefer funds with ESG related language in their name. For the purposes of the report, ESMA also analysed the extent of ESG language across funds’ regulatory documentation and marketing material, using a dataset of more than 100,000 documents available to the public at the end of 2022. ESMA has found evidence of the funds industry adapting its ESG communication depending on the type of document – regulated (i.e., KIID/KID and investment strategies) or unregulated (i.e., marketing documents). ESMA also says that the report findings support recent efforts by policymakers to ensure that EU funds’ names and disclosures accurately reflect their activities. Link to full ESMA Report and its findings here ESAs Analyse the Extent of Voluntary Disclosure of Principal Adverse Impacts Under the SFDR On 28 September 2023, the Joint Committee of the three European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) published their second annual Report on the extent of voluntary disclosure of principal adverse impacts under Article 18 of the Sustainable Finance Disclosure Regulation (SFDR). Similar to the approach adopted for their 2022 Report, the ESAs launched a survey of National Competent Authorities to assess the current state of entity-level and product-level voluntary principal adverse impact (PAI) disclosures under the SFDR, and have developed a preliminary, indicative and non-exhaustive overview of good practices and areas that need improvement.