Featured Product

    ESMA Responds to Proposal on Guidelines on Climate-Related Disclosures

    March 26, 2019

    ESMA issued a comment letter to EC, welcoming its proposal to update the non-binding guidelines on non-financial reporting with the introduction of a specific supplement addressing climate-related disclosures. ESMA made some recommendations on how the guidelines can be further developed to promote higher quality disclosures.

    On February 20, 2019, EC consulted on update of the non-binding guidelines on non-financial reporting. ESMA recommends the EC to ensure that when reviewing the guidelines, an appropriate balance is achieved across requirements relating to the various non-financial matters, with the aim to avoid the issue that focus on a specific matter, such as climate change, detracts from attention to the necessary disclosures on the other non-financial matters. While generally supporting the proposals in the consultation document, ESMA would like to highlight the following key areas where the proposed approach to update the guidelines could be further improved:

    • While ESMA welcomes the EC clarification on how the notion of materiality in the Non-Financial Reporting Directive (NFRD), as transposed into local law, should apply to climate-related disclosures, it believes that the clarifications included in the consultation would also be beneficial for the main text of the guidelines. Therefore, ESMA encourages EC to incorporate these clarifications into the existing section of the guidelines relating to material information.
    • The consultation document proposes to structure the climate-related requirements into "Type 1" and "Type 2" disclosures, wherein Type 1 disclosures would represent more basic or minimum disclosures that issuers are expected to provide in all cases in which climate-related matters are material, while Type 2 disclosures would only be intended to provide more enhanced information. ESMA recommends expanding the disclosures that are currently proposed as Type 1 with some of the requirements that are currently only classified as Type 2 (detailed suggestions in this regard are proposed in the Annex to the comment letter). In addition, ESMA suggests considering the applicability of the proposed structure to the other disclosure requirements in the guidelines.
    • ESMA, building on the enforcement experience of non-financial statements, highlights additional areas for improvement related to the NFRD. In its view, without an increase in the specificity of the requirements in the NFRD, any amendment to the guidelines, even if helpful, is unlikely to result in a significant shift toward more consistent and enforceable non-financial reporting.

     

    Related Links

    Keywords: Europe, EU, Banking, Securities, Sustainable Finance, Non-Financial Reporting, Climate-Related Disclosures, Non-Binding Guidelines, EC, ESMA

    Related Articles
    News

    FSB Examines Financial Stability Aspects of Bigtech and Cloud Services

    FSB published two reports that consider the financial stability implications from the offering of financial services by bigtech firms and the adoption of cloud computing and data services across a range of functions at financial institutions.

    December 09, 2019 WebPage Regulatory News
    News

    APRA Specifies Capital Treatment of Equity Investments in ABGF

    APRA published a letter to the authorized deposit-taking institutions outlining the regulatory capital treatment of their equity investments in the Australian Business Growth Fund (ABGF).

    December 09, 2019 WebPage Regulatory News
    News

    EBA Publishes Action Plan on Sustainable Finance

    EBA published the Action Plan on sustainable finance for banks.

    December 06, 2019 WebPage Regulatory News
    News

    EBA Single Rulebook Q&A: Second Update for December 2019

    EBA updated the Single Rulebook question and answer (Q&A) tool with answers to three questions under the Capital Requirements Regulation (CRR) and the second Payment Services Directive (PSD 2).

    December 06, 2019 WebPage Regulatory News
    News

    APRA Publishes Proposal to Increase Transparency of Banking Data

    APRA proposed to substantially increase the volume and breadth of data it makes publicly available on authorized deposit-taking institutions, including banks, credit unions, and building societies.

    December 05, 2019 WebPage Regulatory News
    News

    ESMA Consults on Guide to Internal Controls for Credit Rating Agencies

    ESMA launched a consultation on the guidelines on internal controls for credit rating agencies (CRAs).

    December 05, 2019 WebPage Regulatory News
    News

    EU Finalizes Directive and Prudential Rules for Investment Firms

    EU published, in the Official Journal of the European Union, the Directive (2019/2034) and Regulation (2019/2033) on the prudential requirements and supervision of investment firms.

    December 05, 2019 WebPage Regulatory News
    News

    OSFI Revises Guideline on Principles for Management of Liquidity Risk

    OSFI finalized Guideline B-6 on the principles for the management of liquidity risk.

    December 05, 2019 WebPage Regulatory News
    News

    ESAs Publish Draft Amendments to Bilateral Margin Requirements

    ESAs published joint draft regulatory technical standards to amend the Delegated Regulation on the risk mitigation techniques for non-cleared over-the-counter (OTC) derivatives as well as a joint statement on the introduction of fallbacks in OTC derivative contracts and the requirement to exchange collateral.

    December 05, 2019 WebPage Regulatory News
    News

    RBNZ Releases Final Decisions Related to Capital Review for Banks

    RBNZ released a paper that sets out its final decisions following the comprehensive review of its capital framework for banks, known as the Capital Review.

    December 05, 2019 WebPage Regulatory News
    RESULTS 1 - 10 OF 4289