John McNally

PhD Applicant

Environmental Research Institute

University College Cork

ERI Research Open Day, 15th December 2010, Devere Hall, UCC.

Environmental Information and the Financial Markets

The Regulation of Financial Markets:

Pluralism v Chaos

What is “Greenwashing”?

Material Information

Information is considered material if there is a substantial likelihood that a reasonable investor would consider it important in deciding how to vote or make an investment decision, or if the information would alter the total mix of available information.

Material Information relating to Climate Change

Climate Risk/Opportunity

E.G. Adverse effects of weather/new product opportunities

Regulatory Risk

E.G. Emissions Levels i.e. cost of acquiring credits.

Investor/Listed Company

Irish Stock Exchange Ltd.

Central Bank of IrelandOffice of the Director Of Corporate Enforcement(ODCE)

Investor/Listed Company

Irish Stock Exchange Ltd.

Central Bank of Ireland

Investment Funds, Companies and Miscellaneous Provisions Act 2005 Central Bank Act 2010

S.I. No. 342/2005 — Market Abuse (Directive 2003/6/EC) Regulations 2005

ODCE

Companies Act 1990

Company Law Enforcement Act 2001

Investor/Listed Company

Irish Stock Exchange Ltd.

Central Bank of Ireland

Investment Funds, Companies and Miscellaneous Provisions Act 2005 Central Bank Act 2010

S.I. No. 342/2005 — Market Abuse (Directive 2003/6/EC) Regulations 2005

ODCE

Companies Act 1990

Company Law Enforcement Act 2001

Market Abuse (Directive 2003/6/EC)

Markets in Financial Instruments Directive (MiFID) Directive 2004/39/EC

Transparency Directive (2004/109/EC)

Prospectus Directive (Directive 2003/71/EC)

Relevant Stock Market Rules

~ Uphold Market Integrity (Honesty, due care/diligence)

~ Honesty very broad (would dishonesty include false advertising?)

~ Rules governed in accordance with laws of Ireland

Criminal Law

Criminal Justice (Theft and Fraud Offences) Act 2001

Main Provisions:

S2 Definitions;

2(1) Dishonesty

2(2) Deception

S6 Deception;

S10 False Accounting;

S11 Suppression of Documents;

S24/25 Forgery;

S40 Corruption;

S41 Fraud Affecting EU Interests;

S51 Destruction of Evidence.

Burden of Proof – High – Beyond reasonable doubt

Civil Law

Investment Funds, Companies and Miscellaneous Provisions Act 2005

S33 Civil Liability for Market Abuse

i.e. Liable to compensate for any losses suffered.

Burden of proof – lower – balance of probabilities

Conclusion

So What?

Pluralism or Chaos?

Wait and See?

Thanks for Listening!

Any Questions?