The FCA has announced it will be bringing ESG ratings providers within its “regulatory perimeter”, as well as looking at how it can adopt International Sustainability Standards Board (ISSB) standards into its rules.
Speaking at the recent Climate Financial Risk Forum’s Symposium in London, FCA chair Ashley Alder said that ESG ratings were increasingly being used by investors but the market was “fragmented” and “can lack transparency”.
Alder said the Regulator would be consulting on a framework “to ensure that ESG ratings are robust, reliable, and aligned with investor needs”.
He added that with the Government having closed its consultation on endorsing the ISSB Standards to create new UK Sustainability Reporting Standards, the FCA would be considering how to adopt the ISSB standards into its rules.
“We will soon consult on how we will update our rules to apply these standards to listed companies. Ultimately, this work supports the integrity of sustainable finance and strengthens the UK’s role in shaping global standards,” Alder said.
The full speech can be read HERE.
