Member

Are we aligning all the methodology in directing what ESG means? Regulating ESG ratings providers will address lack of transparency behind ratings, which will drive investment and support growth. It will not dictate the underlying methodology behind different providers’ ratings but will allow space for continued innovation in the sector. Are we copying the EU, and how do the UK proposals for ESG ratings provide regulation compared with EU proposals? The UK and the EU approaches draw on the 2021 recommendations of the International Organization of Securities Commissions. This is an important foundation, which has enabled Treasury officials to engage with counterparts in the European Commission to ensure that we are maximising the internal coherence of our respective approaches. However, our regimes will not be identical. The UK approach will be proportionate and tailored to the needs of the UK market in the regulatory framework. The FCA is consulting on the detailed rules for ESG ratings providers.