FCA pursued over Ithaca
So, you’ve heard that NGO ClientEarth has broken new ground by launching litigation against Shell directors over the company’s climate plans. Well, the campaigners don’t stop there: they have announced litigation against a major regulator over the prospectus of a listed company.
ClientEarth claims the Financial Conduct Authority (FCA)“acted unlawfully” by approving the prospectus of oil and gas company Ithaca Energy “despite the company’s disclosures failing to adequately describe” the climate-related risks it faces.
According to Robert Clark, a lawyer at ClientEarth, the job of the regulator is to protect investors by ensuring companies disclose information about the key risks they face.
“In the case of Ithaca’s listing, we believe the regulator has failed when it comes to this fundamental function by ultimately waving through Ithaca’s prospectus even though legal requirements have not been met.”
The FCA intends to oppose the claim. But it remains another instance of campaigners upping the climate ante on companies, and now regulators, through litigation. The courts may become extremely busy in the coming months and years.
Sorry state
Regular readers know Board Agenda loves to document the US’s ongoing nervous breakdown over ESG. Well, here’s the latest.
Florida governor Ron DeSantis (pictured, above) this week launched work on new laws that would block the use of ESG in investment decisions made by the state, “ensuring only financial factors are considered to maximise the return on investment, protecting retirees and taxpayers alike”.
“Environment, social and governance investment practices prioritise woke ideals and virtue signalling over common sense financial practices,” a DeSantis document says. We have nothing amusing to say about this.
Unhealthy behaviour
Making dodgy claims on emergency Covid-19 funds for companies hasn’t worked out too well in some places. Figures released by the Insolvency Service show that 356 directors have been disqualified in the current financial year for abuse of Covid-19 support schemes. That’s out of a total of 749 disqualifications and compares with 141 in 2021-22 (and 2022-23 isn’t over yet).
The Times reports that £1 in every £6 given to companies for Covid help was potentially fraudulent. That would suggest the disqualifications have a long way to go yet.