The challenge posed by General Rule 461 of the Financial Market Commission (CMF) requires reporting ESG policies and goals.
Thus, banks, insurance companies, issuers of publicly offered securities, general fund managers and stock exchanges operating in Chile must report the policies, practices and goals adopted in environmental, social and governance matters, better known as criteria. ESG or ESG for its acronym in English.
Responsible investments and sustainable finance are gaining relevance worldwide. This approach, which has been developing for decades, is now becoming part of specific climate change measures and is rapidly being transformed into regulatory norms.
In concrete terms, at the end of 2021, in the framework of the COP 26, Chile announced the General Rule 461 of the Financial Market Commission (CMF) was announced. The new law, which requires banks, insurance companies, issuers of publicly traded securities, general fund managers and stock exchanges operating in the territory, to report on the policies, practices and goals adopted in environmental, social and governance (ESG) matters, better known as ESG criteria.
This is in direct correlation with the European Union’s Sustainable Finance Disclosure Regulation (SFDR) and a global trend towards the Corporate SustainabilityThe subject, which for some time now has been a topic that Gonzalo AsencioEnvironmental management specialist and CEO of SIGEA Software, a tool specialized in management and reporting.
“This standard invites companies to define a Corporate Sustainability strategy that must be reported, so it also directs efforts to strengthen the capacity to effectively measure, monitor and manage ESG factors ,” says Asencio. In this way, both investors and the general public can evaluate and select those alternatives in which their interests would be better protected, as they are better prepared to identify, quantify and manage their risks.
The measure is being applied gradually, according to the specific characteristics of each entity, so today it is essential to initiate compliance actions with a clear focus on the materiality aspects of each business, as well as to put urgency towards a digital transformation that helps entities to centralize, manage and trace non-financial data to achieve ESG/ASG reportability required by the CPM NCG 461.
In search of a tool capable of dealing with this new regulation, we talked to the Environmental Manager of SIGEA Software, Hans Willumsen, who tells us how they approach this task: “With 14 years of experience in the area, we believe that this is part of the specialty of SIGEA Software. We have a complete module made for reporting Indicators and Standards, Therefore, when faced with this type of specific regulations, what our team of experts does is to systematize the requirements incorporated in the standard, so that the client has clarity on what is required and thus can make a prioritization and efficient management. This is done, in addition, considering the particularities of each company or project”.
Although NCG 461 is a step forward in transparency and sustainability, it is still a concern for the teams in charge of implementing it, so it is encouraging to know that software such as SIGEA facilitates these tasks, even when already working with other management and reporting tools. This is how he explains it César BarraSIGEA’s Innovation and Projects Manager: “As Sigea, we have a module that allows us to manage this standard in response to the authority’s request, which, given its versatility, can be perfectly integrated with the existing systems that the company manages to obtain the data”.
It should be recalled that this regulation will come into force from December 2022 and will be fully applied by December 2024, where the annual report of the entities will be made available to shareholders and the general public on their own website, remaining visible for 5 consecutive years, which in addition to making data and concrete actions transparent, pushes to propose and meet more ambitious goals in terms of ESG/ASG criteria, totally necessary given the demands of the current socio-environmental scenario.
To learn more about SIGEA Software go to SIGEASoftware.com and follow their LinkedIn page.
See in Cooperativa: https://www.cooperativa.cl/noticias/corporativo/noticias/contenido-patrocinado/sustentabilidad-corporativa-como-lograr-la-reportabilidad-de-la-ncg-461/2022-07-11/194517.html
