Best Execution
  • Home
  • Publication

    Best Execution

    • Current issue
    • Back issues
    • Profiles
    • Viewpoint
    • Market Opinion
    • Supplements
  • Topics

    Topics

    • Equities Trading
    • Fixed Income Trading
    • Derivatives Trading
    • FX – Foreign Exchange
    • Post-trade
  • Partners
  • Listings
  • Awards

    European Women in Finance Awards

    • European Women in Finance – The Programme
    • European Women in Finance – The Winners
  • Events
  • About us

    About us

    • Marketing
    • Media info
    • Contact
  • Newsletter
  • Login
  • Home
  • Publication
    • Current issue
    • Back issues
    • Profiles
    • Viewpoint
    • Market Opinion
    • Supplements
  • Topics
    • Equities Trading
    • Fixed Income Trading
    • Derivatives Trading
    • FX – Foreign Exchange
    • Post-trade
  • Partners
  • Listings
  • Awards
    • European Women in Finance – The Programme
    • European Women in Finance – The Winners
  • Events
  • About us
    • Marketing
    • Media info
    • Contact
  • Newsletter
  • Login
HomeNewsFrench and Dutch regulators call for robust Europe ...
Previous Next

French and Dutch regulators call for robust European framework for ESG data and ratings

Posted by: Lynn Strongin Dodds, December 15, 2020
Tweet
Share
Share
Pin
0 Shares
Laura van Geest, chair of the Executive Board of the Dutch Authority for the Financial Markets (AFM).
Laura van Geest, chair of the Executive Board of the Dutch Authority for the Financial Markets (AFM).

The Autorité des marchés financiers (AMF) and its Dutch counterpart, the Autoriteit Financiële Markten (AFM), have joined forces to issue a joint position paper calling for a European regulatory framework of ESG data, ratings, and related services for providers of sustainability-related services.

The proposed framework is aimed at preventing misallocation of investments, greenwashing, and ensuring investor protection. It includes requirements on transparency on methodologies, management of conflicts of interest, internal control processes, and enhanced dialogue with companies subject to sustainability ratings.

Interest in ESG and sustainability has been growing among the buyside community, but it has accelerated during the pandemic as these securities have outperformed their more mainstream counterparts. However, one of the biggest challenges to integrating ESG related material into research is the lack of uniform and standard data sets as well as diverse methodologies.

 

In addition, although their influence is expected to grow considerably, providers of sustainability-related services remain largely unregulated.

As a result, the regulators want to see greater transparency on methodological choices and on the origin of data. They believe that the increased transparency would allow users to ensure that they share a common understanding of ESG performance and allow for better comparability between providers.

In recent years, Europe has seen consolidation in the market for sustainability-related services which could lead to higher risks due to a limited number of providers, higher prices and the emergence of new potential conflicts of interest.

They believe the framework is a starting point but that should be periodically assessed but the aim is to have organisational and operational requirements to ensure robust processes for data collection and processing.

“We believe providers of sustainability-related services play a crucial role for investors in the market for sustainable finance,”said Laura van Geest, Chair of the Dutch Authority Financial Markets (AFM). “Many investors depend on them in their investment decisions. Introducing minimum transparency and organisational requirements should greatly benefit this key part of the sustainable finance ecosystem.

She added, “This joint AMF/AFM position paper aims at contributing to the debate on what regulation of ESG rating and data services providers should look like. We would like to invite regulators, market players and other stakeholders to add their perspectives to this debate.”

Robert Ophèle, Chair of the Autorité des marches financiers (AMF).
Robert Ophèle, Chair of the Autorité des marches financiers (AMF).

Robert Ophèle, Chair of the Autorité des marches financiers said, “The sustainable investment market is growing rapidly, but its credibility depends largely on the quality and reliability of the ESG information used. It is with this objective in mind and to ensure investor confidence that we wish to propose with the AFM a European regulatory framework for ESG data and service providers. The construction of such a regulation should be put on the agenda of the renewed sustainable finance strategy and conducted collectively.”

©BestExecution 2020

Back to Top

0

Tags: analytics, Autorité des Marchés Financiers (AMF), Autoriteit Financiële Markten, data, ESG, European, Laura van Geest, ratings, regulation, Robert Ophèle

Share!
Tweet

Lynn Strongin Dodds

About the author
mm

Related Posts

Capco paper outlines EMIR REFIT challenges

Capco paper outlines EMIR REFIT challenges

The European Markets Infrastructure Regulation (EMIR) REFIT standards are likely to require sig ...
The role of ESG derivatives in hedging and pricing

The role of ESG derivatives in hedging and pricing

As environmental, social and governance (ESG) issues grow in importance, the derivatives market ...
ESMA publishes EMIR REFIT technical standards on OTC derivatives

ESMA publishes EMIR REFIT technical standards on OTC derivatives

The European Securities and Markets Authority (ESMA) published draft technical standards under ...
SIX survey shows mismatch between data goals and skill set requirements in financial services

SIX survey shows mismatch between data goals and skill set requirements in financial services

Data may be the lifeblood of the financial service industry but there needs to be greater empha ...

Leave a Reply Cancel reply

You must be logged in to post a comment.

Subscribe for Email Updates

Best Execution
Recent
  • Capco paper outlines EMIR REFIT challenges

    Capco paper outlines EMIR REFIT challenges

    January 25, 2021
    The role of ESG derivatives in hedging and pricing

    The role of ESG derivatives in hedging and pricing

    January 22, 2021
    Video interview with Rhian Ravenscroft

    Video interview with Rhian Ravenscroft

    January 21, 2021
    The liquidity landscape post-Brexit

    The liquidity landscape post-Brexit

    January 20, 2021
    European Women in Finance : Else Braathen : A call to action

    European Women in Finance : Else Braathen : A call ...

    January 20, 2021

Menu

  • Home
  • Publication
  • Topics
  • Events
  • Partners
  • Listings
  • Privacy notice
  • About us

Best Execution

In these uncertain times and as the tide of regulation rises ever higher and wider, Best Execution offers an in-depth analysis into the major trends that are shaping the financial services industry as well as providing a more detailed insight into the technology driving new products and services being developed to meet these challenges.

Where the buyside and sellside meet.

Wikipedia: Best Execution

Social

linkedin
Newsletter Sign Up
Copyright © 2020 Best Execution | Site by Refractiv.
  • Home
  • Publication
  • Events
  • Privacy notice
  • Login