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Climate risk now included in OECD corporate governance guidance

- G20 leaders have officially endorsed global corporate governance principles that now include sustainability considerations.

- The Organization for Economic Cooperation and Development (OECD) reported this development, which aims to boost investor confidence and financial stability through baseline corporate governance standards.

- The updated principles cover guidance on sustainability considerations, climate-related risks and opportunities, shareholder rights, institutional investor roles, and disclosure.

- The revisions promote the disclosure of sustainability-related information and clarify board responsibilities regarding sustainability issues.

- They also recommend dialogue between companies, shareholders, and stakeholders on these sustainability matters.

- While most jurisdictions encourage sustainability-related disclosure, only a few have regulatory provisions on ESG ratings and index providers.

- The principles aim to help companies access capital markets financing, protect investors, and enhance corporate and economic resilience, reflecting recent changes in corporate governance and capital markets.


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