SWITZERLAND Law and Practice Contributed by: Judith Raijmakers and Florian Thomas Willi, Loyens & Loeff
with the recommendations of the task force on climate-related financial disclosures. In gener - al, the report can be based (content-wise) on nationally or internationally recognised guide - lines (such as the relevant OECD guidelines). For completion, Swiss corporate law also impos - es certain transparency and due diligence duties with respect to conflict minerals and child labour. Disclosure of Climate-related Risks In FINMA Circular 2016/01 “Disclosure – Banks”, FINMA mandates significant financial institu - tions (those in supervisory categories 1 and 2) to meet disclosure requirements related to cli - mate-related financial risks. As such, the larg - est banks must provide details on their material climate-related financial risks and explain how these risks impact their business strategy, busi - ness model, and financial planning. Additionally, they are required to disclose their processes for identifying, measuring, and managing these risks, including providing quantitative data and outlining the methodologies used. Finally, insti - tutions must describe the key aspects of their governance structures as they relate to climate- related financial risks. Self-Regulation As mentioned above, Switzerland has largely relied on self-regulation with respect to ESG. As of January 2024, members of the SBA are subject to guidelines on the inclusion of ESG preferences and ESG risks in investment advice and asset management. This introduces bind - ing self-regulation regarding sustainable finance, also covering the risk of greenwashing at the point of sale for SBA members. AMAS has developed a principle-based self- regulation for sustainable asset management
(currently version 2.0). This set of rules applies to AMAS member institutions (including banks) that produce and manage sustainability-related collective assets. It aims to ensure transparency and quality in the management and positioning of collective assets presented as sustainable or having sustainable characteristics. Broad Interpretation of General Principles It needs to be noted that in certain cases, general principles are applied broadly for pur - poses of ESG compliance – eg, with respect to greenwashing. With respect to funds, the name of a fund may not give rise to confusion or be deceptive. As part of authorisation proceedings by FINMA, this has been interpreted broadly to combat greenwashing with respect to fund products. Further – and equally relevant in the context of greenwashing – Swiss competition law prohibits deception or conduct that violates the principle of good faith. The Digital Operational Resilience Act (DORA) is a European Union regulation aimed at strength - ening IT security and operational resilience within the financial sector. It will become fully applicable by January 2025 and aims to ensure that banks, insurance companies, investment firms, and third-party information and commu - nication technology (ICT) service providers can withstand severe operational disruptions. It also standardises operational resilience rules across 20 categories of financial entities in the EU. Although Switzerland is not an EU member state and Swiss banks are not directly subject to DORA, those banks operating within the EU will need to comply with its requirements. In prac - 10. DORA 10.1 DORA Requirements
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