06 February 2020. The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, has today published its Strategy on Sustainable Finance. Steven Maijoor, Chair, said: The financial markets are at a point of change with investor preferences shifting towards green and socially responsible products, and with sustainability factors increasingly affecting the risks, returns and value of investments.
The strategy sets out how ESMA will place sustainability at the core of its activities by embedding Environmental, Social, and Governance (ESG) factors in its work. (Page 4) The enhanced regulatory framework increases, through a single set of standards, transparency obligations and enhancement of due diligence processes on financial markets participants in relation to ESG. It should ensure that the risk of “greenwashing” is reduced and that investors are informed about, and can compare, the ESG credentials of their investments.