GASLA releases update to Global Framework for ESG and Securities Lending
07 March 2023 UK
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The Global Alliance of Securities Lending Associations (GASLA) has released an update to the Global Framework for ESG and Securities Lending (GFESL).
The initiative reflects GASLA’s commitment to provide market participants with a practical framework for evaluating securities lending in the context of financial institutions’ ESG policies.
The updated version, developed in collaboration by the five member associations of GASLA, equips the industry with a global perspective on the intersection of securities lending and ESG considerations.
The 2023 GFESL updates the first version of the framework, which was released by the Pan Asia Securities Lending Association (PASLA) and Risk Management Association (RMA) in May 2021 with the support of the International Securities Lending Association (ISLA).
This provided the first practical guidance on how securities lending market participants could approach ESG issues in their businesses.
It provides insight into key considerations across the five main touchpoints between securities finance and ESG: voting rights, collateral, lending over record dates, facilitating participation in the short side of the market and transparency in the lending chain.
The GFESL also offers commentary on the legal and regulatory context for each touchpoint as well as practical guidance for lenders.
Andrew Dyson, CEO of ISLA, says: “ISLA, along with our sister associations, understands the importance of developing a global approach to ESG, to support the role that securities lending plays in our markets, whilst adapting to ESG considerations.
“I firmly believe it is the role of industry bodies such as GASLA to identify the challenges that members face and help drive solutions, through advocacy and engagement with regulators and our members, towards development of market practice standards.”
The initiative reflects GASLA’s commitment to provide market participants with a practical framework for evaluating securities lending in the context of financial institutions’ ESG policies.
The updated version, developed in collaboration by the five member associations of GASLA, equips the industry with a global perspective on the intersection of securities lending and ESG considerations.
The 2023 GFESL updates the first version of the framework, which was released by the Pan Asia Securities Lending Association (PASLA) and Risk Management Association (RMA) in May 2021 with the support of the International Securities Lending Association (ISLA).
This provided the first practical guidance on how securities lending market participants could approach ESG issues in their businesses.
It provides insight into key considerations across the five main touchpoints between securities finance and ESG: voting rights, collateral, lending over record dates, facilitating participation in the short side of the market and transparency in the lending chain.
The GFESL also offers commentary on the legal and regulatory context for each touchpoint as well as practical guidance for lenders.
Andrew Dyson, CEO of ISLA, says: “ISLA, along with our sister associations, understands the importance of developing a global approach to ESG, to support the role that securities lending plays in our markets, whilst adapting to ESG considerations.
“I firmly believe it is the role of industry bodies such as GASLA to identify the challenges that members face and help drive solutions, through advocacy and engagement with regulators and our members, towards development of market practice standards.”
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