On 2 April 2024, the European Securities and Markets Authority (ESMA) launched a consultation on proposed amendments to Commission Delegated Regulation (EU) 447/2012 and to Annex I of the Credit Rating Agencies Regulation (CRAR).


ESMA received a formal request from the European Commission, in June 2023, for Technical Advice on how Delegated Regulation (EU) 447/2012 and Annex I of the CRAR could be amended to ensure that relevant environmental, social and governance (ESG) factors are systematically captured in credit ratings and to improve transparency on the inclusion of ESG risks by credit rating agencies in credit ratings and rating outlooks.

Proposed amendments

The consultation paper sets out ESMA’s proposed advice to the European Commission on these points. In particular, ESMA notes that the proposals aim to:

  • Ensure that the relevance of ESG factors within credit rating methodologies is subject to systematic documentation.
  • Enhance disclosures on the relevance of ESG factors in credit ratings and rating outlooks.
  • Deliver a more robust and transparent credit rating process through the consistent application of credit rating methodologies.

Next steps

The consultation closes on 21 June 2024. ESMA plans to consider the feedback it receives and submit its Technical Advice to the European Commission by December 2024.