Legal & Regulatory News

​European Commission launches consultation on the functioning of the ESG ratings market in the EU and the consideration of ESG factors in credit ratings

On 4 April 2022, the European Commission (the Commission) launched a targeted consultation on ESG ratings and sustainability factors in credit ratings entitled, 'Functioning of the ESG ratings market in the European Union and on consideration of ESG factors in credit ratings' (the Consultation).

The Consultation comes as part of the Commission's renewed sustainable finance strategy which was adopted in July 2021. It aims to support the Commission in gaining a better insight into the functioning of the market for ESG ratings and towards a better understanding of how credit ratings agencies incorporate ESG risks in their creditworthiness assessment.

Responses from market participants will feed into an impact assessment that will evaluate whether a possible policy initiative is needed on ESG ratings and on sustainability factors in credit ratings. These actions are intended to improve the quality of information upon which investors, businesses and other stakeholders make decisions impacting the transition to a sustainable economy.

The Consultation is open for responses between 4 April 2022 and 6 June 2022.

Click here to access the Consultation.

Click here to respond to the Consultation (via EU login).