On 4 August 2022, the European Commission published a report providing an overview of the results of an earlier targeted consultation on ‘ESG ratings and ESG factors in credit ratings’.

Among other things the report notes that:

• The vast majority of respondents declare that they do use ESG ratings and among these, 77% use them ‘very much’, while a smaller share use them ‘a little’.
• Almost all respondents replied that they value and need transparency in data sourcing and methodologies and timeliness, accuracy and reliability of ESG ratings.
• On the level of competition of the ESG ratings market, views are mixed, with an almost identical percentage of respondents considering the market to be competitive and not competitive. The largest share of views of respondents were neutral on this.
• Almost all respondents expect the ESG ratings market to grow.
• Almost all respondents (94%) consider that intervention in the ESG ratings market is necessary, of which the large majority (80%+) support a legislative intervention with the remainder supporting the development of non-regulatory intervention in the form of guidelines, code of conduct.
• The vast majority of respondents (82%) consider that ESG rating providers should be subject to some form of authorisation/registration regime in order to offer their services in the EU.

The report adds that the results of the consultation will be reflected in the preparation of any further Commission initiatives in this area.