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Brussels – In the EU, stricter rules will apply in the future for providers of sustainability ratings for companies or investment products. The EU countries adopted corresponding new regulations in Brussels, which aim to strengthen investor confidence in sustainable financial products. Accordingly, sustainability ratings, so-called ESG ratings, should become more reliable and comparable.
To achieve this, the transparency and integrity of the activities of ESG rating providers should be improved and potential conflicts of interest avoided, the countries said. For example, ESG rating providers based in the EU would have to be approved and supervised by the European Securities and Markets Authority (ESMA) and meet transparency requirements, especially regarding their methodology and information sources.
“ESG ratings are becoming increasingly important for the functioning of the capital markets and investor confidence in sustainable investment products,” it said.
The basis of the new rules was a proposal by the EU Commission from last year, which was negotiated by representatives of the member states and the European Parliament. They are now to be published in the EU Official Journal and will come into effect 20 days later.
The abbreviation ESG stands for Environmental (Umwelt), Social (Soziales), and Governance (approx. Corporate Governance). (19.11)