ESG in the banking, financial and insurance sectors – ESAs opinions on European Sustainability Reporting Standards

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On 26 January 2023, the ESAs (ESMA, EIOPA, and EBA) published their respective opinions on the first set of European Sustainability Reporting Standards.

On 26 January 2023, the European Insurance and Occupational Pensions Authority (“EIOPA”), the European Securities and Markets Authority (“ESMA”) and the European Banking Authority (“EBA”, together with EIOPA and ESMA, the “ESAs”) published their respective opinions on the first set of European Sustainability Reporting Standards (“ESRS Set 1”) submitted by the European Financial Reporting Advisory Group (“EFRAG”).

The opinions follow a request made by the EU Commission to each of the ESAs to assess, in particular, the consistency of ESRS Set 1 with the provisions of Regulation (EU) 2019/2088 (“SFDR”) and its related delegated acts.

1. Background

ESRS Set 1 specifies the rules and requirements regarding the reporting on sustainability-related aspects under the Corporate Sustainable Reporting Directive (“CSRD”).

2. Key considerations

2.1 EIOPA opinion

EIOPA considers that ESRS Set 1 overall meets the objectives of promoting the disclosure of high quality material sustainability information, facilitating interoperability with other EU legislation and global standards, and being conducive to consistent and proportionate application by undertakings.

EIOPA notes, however, that some aspects could be enhanced:

2.2 ESMA opinion

ESMA finds that ESRS Set 1 broadly meets the objective of being conducive to investor protection and not undermining financial stability.

ESMA draws attention to the need to:

2.3 EBA opinion

EBA acknowledges the overall consistency of ESRS Set 1 with international standards and any other relevant EU law and welcomes the extent of alignment with the Pillar 3 disclosure requirements reached at this stage.

EBA emphasises, however, a few aspects that merit further consideration by the EU Commission, including:

3. Next steps

ESRS Set 1 is expected to be adopted by the EU Commission via delegated acts by 30 June 2023, after the Commission has considered the opinions published by the ESAs, as well as those submitted by other public bodies.

Complying with and adapting to the ever-evolving ESG framework is a constant challenge – please, contact our experts to help you to meet this challenge and stay ahead of the game.

 

To read EIOPA’s opinion, click here_

To read ESMA’s opinion, click here_

To read EBA’s opinion, click here_

To read ESRS Set 1, click here_

Download the press release

Luxembourg Newsflash – ESG in the banking, financial and insurance sectors – ESAs opinions on European Sustainability Reporting Standards

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