Publication
“AI and sustainability - cure or curse?”
While AI can help resolve data issues in sustainable investing, it can create problems such as information breaches and inherent bias in data.
Global | Publication | June 22, 2018
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On June 19, 2018 the Financial Reporting Council’s Financial Reporting Lab (Lab) published a report on current developments in relation to blockchain, and on potential uses and impacts of blockchain on corporate reporting. This report forms part of the Lab’s wider project on the digital future.
The report notes that blockchain (also called a distributed ledger) is a type of shared database which creates a permanent record of transactions. Since it is distributed across a number of participants in a network and is not under the control of a single participant, it is robust. This, combined with the fact that any changes made to the data are clear to all participants, ensures both the data and the network are resilient. As a result, the report comments that blockchain is different from a traditional database because of the way it creates trust and resilience and it looks at whether blockchain could solve some of the existing corporate reporting challenges, which include:
The report concludes that while blockchain is not the only possible answer (or even the best), it does have the potential to solve some of the challenges in the stages of corporate reporting as follows:
As a result, the report suggests that blockchain merits consideration and experimentation by preparers, regulators and users of corporate reporting and it sets out specific actions for each of these different parties in order to take blockchain forward..
(FRC, Financial Reporting Lab report – blockchain and the future of corporate reporting, 19.06.18)
On June 22, 2018 the Financial Reporting Council’s Financial Reporting Lab (Lab) published a report setting out the views of investors on the reporting of performance metrics. The reports includes a framework and set of questions for companies and boards to consider when deciding on how they report the company’s performance.
“Performance metrics”, for the purposes of the report, means all forms of metric a company might disclose to provide information about its performance, position and prospects, including financial metrics (GAAP and non-GAAP) and wider metrics (standardised and company specific). The report considers investors’ use of performance metrics and notes that investors want to see the following:
The next phase of this project, including examples of how companies have put the principles in the report into practice, will be published in Autumn 2018.
(FRC, Financial reporting Lab, Reporting of performance metrics, 22.06.18)
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While AI can help resolve data issues in sustainable investing, it can create problems such as information breaches and inherent bias in data.
Publication
In this edition of Regulation Around the World we review recent steps that financial services regulatory authorities have taken as regards investment research.
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n a long-running dispute, taking in no less than three arbitrations spanning 26 years cumulatively (involving allegations of state interference in the arbitral process), the Court has provided useful guidance on the ss.67 and 68 challenges, particularly in the context of investor-state claims.
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