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Topic: ESG

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SFDR queries forwarded to the Commission

On 13 May 2022, the European Supervisory Authorities (ESAs) submitted to the European Commission 10 queries regarding the interpretation of the Sustainable Finance Disclosure Regulation (SFDR) and the Taxonomy Regulation (TR). The queries relate to the following five areas: Principal adverse impact (PAI) disclosures: Whether it is possible for a financial market participant to not … Continue Reading

Commission letter to the ESAs concerning amendments to the RTS under the SFDR

On 6 May 2022, the European Commission published a letter (dated 11 April 2022) which it had sent to the chairs of the European Supervisory Authorities (ESAs) concerning the draft regulatory technical standards (RTS) under the Sustainable Finance Disclosure Regulation (SFDR). The Commission decided to bundle all 13 draft RTS into a single delegated regulation … Continue Reading

ESAs consult on sustainability disclosures for STS securitisations

On 3 May 2022, the European Supervisory Authorities issued a consultation paper seeking input on draft regulatory technical standards (RTS) on the content, methodologies and presentation of information in respect of the sustainability indicators for simple, transparent and standardised (STS) securitisations. The draft RTS do not provide a framework for ‘sustainable securitisation’. Rather they provide … Continue Reading

FSB launches consultation on supervisory and regulatory approaches to climate-related risks

On 29 April 2022, the Financial Stability Board (FSB) issued a report setting out certain recommendations that are intended to assist supervisory authorities in developing their approaches to monitor, manage and mitigate cross-sectoral and system-wide risks arising from climate change and promote consistent approaches across sectors and jurisdictions. The report: Examines supervisory and regulatory reporting … Continue Reading

Commission adopts disclosure rules on sustainable investments

On 6 April 2022, the European Commission adopted a Delegated Regulation (together with five annexes) containing regulatory technical standards (RTS) for disclosures of sustainability-related information under the Sustainable Finance Disclosures Regulation (SFDR). The RTS specify the content, methodology and presentation of the information to be disclosed, thereby improving its quality and comparability. It also supports … Continue Reading

10 things to know about the EU Corporate Sustainability Due Diligence proposal

On 23 February 2022, the European Commission (the Commission) published a proposal for a Directive on Corporate Sustainability Due Diligence (CSDD or the Directive). This note summarises ten key issues enterprises active in the EU should know about the proposed Directive. 1) Aim of the proposal The proposed CSDD serves a number of purposes. First, … Continue Reading

Commission targeted consultation on ESG ratings and sustainability factors in credit ratings

On 4 April 2022, the European Commission issued a targeted consultation on the functioning of environmental, social and governance (ESG) ratings and sustainability factors in credit ratings. The purpose of the consultation is to help the Commission gain a better insight on the functioning of the market for ESG ratings, as well as better understand … Continue Reading

Platform on sustainable finance report on technical screening criteria

On 30 March 2022, the Platform on Sustainable Finance (Platform) issued a report containing recommendations on the technical screening criteria for the four remaining environmental objectives of the EU taxonomy. The report principally contains recommendations relating to technical screening criteria for objectives 3 – 6 of the Taxonomy Regulation, as well as recommendations to improve … Continue Reading

ESAs issue updated supervisory statement on the application of the SFDR

On 25 March 2022, the European Supervisory Authorities (ESAs) updated their joint supervisory statement on the application of the Sustainable Finance Disclosure Regulation (SFDR). The updated statement includes a new timeline, expectations about the explicit quantification of the product disclosures under Articles 5 and 6 of the Taxonomy Regulation, and the use of estimates. The … Continue Reading

NGFS acknowledges that nature-related risks could have significant macroeconomic and financial implications

On 24 March 2022, the Network for Greening the Financial System (NGFS) issued a statement on nature-related financial risks. Among other things the statement notes that on the basis of available scientific evidence, the NGFS is of the view that nature-related risks, including those associated with biodiversity loss, could have significant macro-economic implications, and that … Continue Reading

Supervisory assessment of institutions’ climate-related and environmental risks disclosures

On 14 March 2022, the European Central Bank (ECB) published its report on banks’ progress towards transparent disclosure of their climate-related and environmental risk profiles. Frank Elderson, Member of the ECB’s Executive Board and Vice-Chair of the ECB’s Supervisory Board, has also delivered a speech on the ECB’s supervisory approach on climate-related and environmental risks. … Continue Reading

Commission publishes new Taxonomy Regulation

On 9 March 2022, the European Commission adopted a Delegated Regulation (together with Annexes 1, 2 and 3) amending Delegated Regulation (EU) 2021/2139 (the Taxonomy Climate Delegated Act) as regards economic activities in certain energy sectors and Delegated Regulation (EU) 2021/2178 (the Taxonomy Disclosures Delegated Act) as regards specific public disclosures for those economic activities. … Continue Reading

IOSCO 2022 sustainable finance work plan

On 14 March 2022, the International Organization of Securities Commissions (IOSCO) published its work plan to develop sustainable finance. Among other things IOSCO plans to review the soon-to-be-published IFRS International Sustainability Standards Board (ISSB) Exposure Drafts of proposed climate and general sustainability disclosure requirements, as well as the final standards when they are produced. The … Continue Reading

Commission study on an EU ESG benchmark label

On 4 March 2022, the European Commission updated its webpage on EU labels for benchmarks (climate, ESG) and benchmarks’ ESG disclosures by providing details of a study on feasibility, minimum standards and transparency requirements of an EU ESG benchmark label. The Commission explains that it is exploring the possibility of introducing a new label which … Continue Reading

EBA recommends adjustments to the proposed EU Green Bond Standard as regards securitisation transactions

On 2 March 2022, the European Banking Authority (EBA) published a report that analyses recent developments and challenges in introducing sustainability in the EU securitisation market. The report examines how sustainability could be introduced in the specific context of securitisation to foster transparency and credibility in the EU sustainable securitisation market and to support its … Continue Reading

Platform on Sustainable Finance – report on social taxonomy

On 28 February 2022, the Platform on Sustainable Finance issued a report proposing a structure for a social taxonomy within the current EU legislative environment on sustainable finance and sustainable governance. The current environment consists of: (i) the existing legislation and proposed initiatives on the EU taxonomy; (ii) the proposed corporate sustainability reporting directive; (iii) … Continue Reading

EBF and UNEP FI outline practical approaches to applying EU Taxonomy to bank lending

On 15 February 2022, the European Banking Federation, together with the United Nations Environment Programme Finance Initiative, issued a report, “Practical approaches to applying the EU Taxonomy to bank lending”, that explores practical approaches for banks who wish to use the EU Taxonomy. This includes how the EU Taxonomy could be used by banks that … Continue Reading

ESMA sustainable finance roadmap 2022-2024

On 11 February 2022, the European Securities and Markets Authority (ESMA) published its Sustainable Finance Roadmap 2022-2024. In the Roadmap ESMA identifies three priorities for its sustainable finance work: Tackling greenwashing and promoting transparency. ESMA will investigate this issue, define its fundamental features and address it with coordinated action across multiple sectors. Building Member State … Continue Reading

Macro-financial scenarios for the 2022 climate risk stress test

On 27 January 2022, the European Central Bank (ECB) launched a supervisory climate risk stress test to assess how prepared banks are for dealing with financial and economic shocks stemming from climate risk. In its letter to the CEO of a significant institution, the ECB states that the exercise consists of three distinct modules comprising … Continue Reading

EBA publishes binding standards on Pillar 3 disclosures on ESG risks

On 24 January 2022, the European Banking Authority (EBA) published a final report containing draft implementing technical standards (ITS) on prudential disclosures on environmental, social and governance (ESG) risks in accordance with Article 449a of the Capital Requirements Regulation (CRR). The final report presents the EBA final draft ITS on Pillar 3 disclosures on ESG … Continue Reading

Platform on Sustainable Finance – Response to Complementary Delegated Act

On 24 January 2022, the Platform on Sustainable Finance (Platform) published a report to the European Commission containing its feedback on the draft Taxonomy Complementary Delegated Act – Commission Delegated Regulation (EU) …/… of XXX amending Delegated Regulation (EU) 2021/2139 as regards economic activities in certain energy sectors and Delegated Regulation (EU) 2021/2178 as regards … Continue Reading

Commission Delegated Regulation (EU) 2021/2178 published in the Official Journal of the European Union

On 10 December 2021, there was published in the Official Journal of the European Union (OJ) Commission Delegated Regulation (EU) 2021/2178 of 6 July 2021 supplementing the Taxonomy Regulation by specifying the content and presentation of information to be disclosed by undertakings subject to Articles 19a or 29a of the Accounting Directive concerning environmentally sustainable … Continue Reading

Commission Delegated Regulation 2021/2139 supplementing the Taxonomy Regulation

On 9 December 2021, there was published in the Official Journal of the EU, Commission Delegated Regulation (EU) 2021/2139 of 4 June 2021 supplementing the Taxonomy Regulation by establishing the technical screening criteria for determining the conditions under which an economic activity qualifies as contributing substantially to climate change mitigation or climate change adaptation and … Continue Reading

ESMA publish a letter regarding regulatory technical standards under the Sustainable Finance Disclosure Regulation 2019/2088

On 29 November 2021, the European Securities and Markets Authority (ESMA) published a letter from John Berrigan, Deputy Director-General for Financial Stability, Financial Services and Capital Markets Union, European Commission, to Irene Tinagli, Chair of the Committee on Economic and Monetary Affairs, European Parliament and Andrej Šircelj, President of the Ecofin Council, Council of the … Continue Reading
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