Sidley’s global thought-leadership and comprehensive and strategic advice prepares and positions clients for success in the constantly evolving sustainable finance market.
Our multidisciplinary approach leverages our network of attorneys in financial and securities regulation, sustainability regulation, investment funds, capital markets, insurance, and global finance. Sidley offers a wide range of services to advise our clients, including investment advisors or managers, agents, lenders, underwriters, issuers, borrowers, insurers, and pension providers, in regulatory compliance, structuring cutting-edge financial products, and completing complex transactions.
Our Work
Understanding Regulatory Frameworks
Sidley advises many clients on navigating the complex and evolving regulatory landscape surrounding sustainable finance. Our experience enables us to provide market-leading advice on a wide range of requirements, including sustainability-related disclosures, green bonds, sustainability labeling, and sustainable investments.
Our global practice means that we are able to match our clients’ global presence with our cross-jurisdictional knowledge of sustainable finance laws and regulations to achieve global compliance.
In the EU, our teams routinely advise on sustainable finance across different areas of the financial sector, from asset management to banking to insurance. Accordingly, our lawyers cover a spectrum of regulations, including the EU’s Sustainable Finance Disclosure Regulation (SFDR) and the EU Taxonomy Regulation, as well as guidelines and requirements issued by the European Commission and the European Supervisory Authorities, including the European Securities and Markets Authority (ESMA), the European Banking Authority (EBA), and the European Insurance and Occupational Pensions Authority (EIOPA).
In the UK, our teams cover the Financial Conduct Authority’s (FCA) rules on Sustainability Disclosure Requirements (SDR) and investment labels, Task Force on Climate-related Financial Disclosures (TCFD) reporting on climate-related financial disclosures, the UK Transition Plan Taskforce and Disclosure Framework, and the UK government’s overall green finance strategy.
In the U.S., our teams provide ongoing advice on federal- and state-level requirements, including disclosure requirements under relevant securities laws and regulatory expectations from the U.S. Securities and Exchange Commission.
Structuring Sustainable Finance Products
Sidley assists clients with structuring and issuing sustainable financial products, such as green, social, and sustainability-linked bonds and loans, as well as other forms of securitizations across different geographies.
Green bonds and loans, sustainability-linked bonds and loans, and other sustainability-linked financial products each seek to mitigate an identified economic risk linked to environmental, social, and/or governance objectives and provide valuable new economic opportunities.
Green bonds and green loans identify specific projects for the application of transaction proceeds. Sustainability-linked financial products are not use-of-proceeds restricted, but instead complement an issuer’s stated sustainability objectives and lower (or increase) the cost of funds based on achieving (or the failure to achieve) meaningful and ambitious sustainability targets.
Sidley’s subject matter experience spans from advising market participants on industry guidelines published by the International Capital Markets Association (ICMA) and the Loan Syndications and Trading Association (LSTA), such as the Green Loan Principles and the Sustainability-Linked Loan Principles, to advising large fund managers on setting up “Article 8” and “Article 9” funds under the EU’s Sustainable Finance Disclosures Regulation (SFDR).
Sidley represented the lead agents in the first syndicated sustainability-linked credit facility in the U.S. syndicated finance market. Sidley has also represented the LSTA in preparation and publication of drafting guidance for both sustainability-linked loans and green loans.
Our lawyers routinely help clients with preparation and negotiation of documentation, facilitating review of projects in light of applicable required criteria, and advising on best practices for reporting and transparency.
Sustainability Integration and Strategy Development
Sidley provides clients with market-leading advice that enables them to integrate sustainability factors into clients’ financial or investment strategies. This includes providing ongoing advice to support clients with managing sustainability risks and opportunities, developing sustainability policies, and Sustainable Finance Disclosures Regulation setting measurable sustainability targets.
Stakeholder Engagement and Reporting
The sustainable finance industry continues to be shaped by the changing political and economic environment globally. Effective stakeholder engagement and transparent reporting are crucial components of a successful sustainable finance strategy.
Our clients must navigate the diverse perspectives of many constituencies, including investors, regulators, creditors, employees, customers, communities, and lawmakers, as well as increased scrutiny of their financial products. Sidley can guide clients in developing comprehensive sustainability disclosures and reporting that meet the expectations of these constituencies.
