On 22 November 2022, the FCA announced the formation of a group to develop a voluntary code of conduct for environmental, social and governance (ESG) data and ratings providers (the Code).
In an earlier FCA Feedback Statement on ESG integration in UK capital markets, the FCA expressed their support for introducing regulatory oversight of certain ESG data and ratings providers. This would support greater transparency and trust in the market for ESG data and ratings providers.
Whilst the government considers this proposal, and to maintain momentum, the FCA has worked to convene, support and encourage industry participants to develop and follow a voluntary code of conduct.
The FCA welcomes the appointment of the International Capital Market Association (ICMA) and the International Regulatory Strategy Group (IRSG) as the Secretariat leading the work. The Code will seek to be internationally consistent, by taking into account not only recommendations from the International Organization of Securities Commissions but also developments in jurisdictions such as Japan and the EU. This will help encourage the development of consistent global standards.
Going forward, the Secretariat will convene an independent group to develop the Code. Consistent with their respective objectives, the FCA, the Bank of England and other relevant financial regulators and government departments will sit as active observers to this group.