December 19, 2018

ESMA published a consultation on the disclosure requirements applicable to credit ratings. The paper consults on Credit Rating Agency (CRA) guidelines aimed to improve the quality and consistency of disclosures of environmental, social, and governance (ESG) factors when considered as part of a credit rating action. ESMA will accept responses to the consultation by March 19, 2019 and it expects to publish the final report by July 30, 2019.

The consultation paper proposes measures in the following areas:

  • Guidance to improve the quality and consistency of the information that is disclosed alongside the issuance of a credit rating in a publicly available press release
  • Guidance to improve the transparency of credit rating press releases concerning the extent to which sustainability factors have been considered as part of a credit rating
  • A cost-benefit analysis of the Guidelines in Annex I of the consultation paper

The guidance is intended to improve the quality of disclosures by CRAs in a manner that provides the users of credit ratings with greater transparency on whether Environmental, Social, or Governance factors were considered a key underlying element of a credit rating issuance. Although this is not a subject that is addressed explicitly under the CRA Regulation, ESMA recognizes that, in context of the EC Action Plan for sustainable finance, it is desirable to provide some guidance to the industry to ensure that the quality of disclosures can support investors needs in light of the greater focus that is now being placed on sustainability factors in investment decisions. The guidelines are in line with the EC Action Plan on sustainable finance.

 

Related Links

Comment Due Date: March 19, 2019

Keywords: Europe, EU, Banking, Insurance, Securities, CRA Regulation, CRA, Disclosures, ESG, Sustainable Finance, ESMA

Related Articles
News

BCBS and IOSCO Extend Implementation of Final Phase of Margin Rules

BCBS and IOSCO agree to one-year extension of the final implementation phase of the margin requirements for non centrally cleared derivatives.

July 23, 2019 WebPage Regulatory News
News

APRA Proposes Stronger Remuneration Requirements in Australia

APRA is proposing to strengthen prudential requirements for remuneration across all APRA-regulated entities in the banking, insurance, and superannuation industries by issuing CPS 511, a new prudential standard on remuneration.

July 23, 2019 WebPage Regulatory News
News

PRA Consults on Availability of Group Own Funds Under Solvency II

PRA published a consultation paper (CP16/19) that sets out its proposed approach to the determination of the availability of subordinated liabilities and preference shares in group own funds.

July 22, 2019 WebPage Regulatory News
News

EIOPA Consults on Methodological Principles for Insurer Stress Testing

EIOPA published a discussion paper on the methodological principles for stress testing the insurance sector in EU.

July 22, 2019 WebPage Regulatory News
News

US Agencies Adopt Rule to Exclude Community Banks from Volcker Rule

US Agencies (CFTC, FDIC, FED, OCC, and SEC) adopted a final rule to exclude community banks from the Volcker Rule, in line with amendments to certain sections of the Economic Growth, Regulatory Relief, and Consumer Protection (EGRRCP) Act.

July 22, 2019 WebPage Regulatory News
News

US Agencies Adopt Amendments to Simplify Regulatory Capital Rules

US Agencies (FDIC, FED, and OCC) adopted a final rule that reduces regulatory burden by simplifying several requirements in the regulatory capital rules for banks.

July 22, 2019 WebPage Regulatory News
News

IA of Hong Kong Delegates Inspection and Investigation Powers to HKMA

HKMA and IA of Hong Kong jointly issued a statement announcing the delegation of the inspection and investigation powers of IA to HKMA, pursuant to the statutory regulatory regime for insurance intermediaries under the Insurance Ordinance.

July 19, 2019 WebPage Regulatory News
News

FSB Extends Implementation Timeline for Policy Recommendations on SFTs

FSB announced adjustments to the implementation timelines for its recommendations on securities financing transactions (SFTs), specifically those related to the minimum haircut standards for non-centrally cleared SFTs.

July 19, 2019 WebPage Regulatory News
News

EBA Single Rulebook Q&A: Third Update for July 2019

EBA published answers to six questions under the Single Rulebook question and answer (Q&A) tool this week.

July 19, 2019 WebPage Regulatory News
News

EBA Report Assesses Regulatory Framework for Fintech Activities

EBA published the findings of its analysis on the regulatory framework applicable to fintech firms when accessing the market.

July 18, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 3494