ESG / Sustainability regulatory updates from European Union.
We track 52 ESG / Sustainability updates from European Union regulators, published by ESMA, ECB and EBA. The archive covers 16 speeches, 13 reports and 9 guidance notes. Most recent update: November 2026. Coverage runs from 2025 to 2026.
The European Banking Authority (EBA) today outlines the way forward for the finalisation of proposals to simplify EU supervisory reporting, following extensive dialogue with the banking industry and feedback received during the public consultation. The package that is currently being finalised will introduce…
AI Analysis
The EBA has announced material changes to its proposed revision of the supervisory reporting ITS after consultation feedback, including additional template reductions, greater proportionality, lower reporting frequencies and delayed implementation. The first reference date for new requirements is postponed to December 2027, while liquidity, asset encumbrance, supervisory benchmarking and ESG reporting changes are deferred to December 2028; independent industry analysis characterises the package as a broad reform that also integrates CRR3, CRD6, IFRS 18, market-risk and ESG reporting requirements.
Key dates
2026-11-06
EBA publishes its policy statement on the post-consultation direction of the supervisory reporting simplification package.
2026-12-01
EBA is expected to publish the final report on the draft ITS package; the precise publication date was not specified.
2026-12-31
EBA expects to publish guidance on designing and making supervisory and resolution data requests by the end of 2026; the precise date was not specified.
2027-01-01
Firms should take into account the EBA consideration on application of the FRTB from this date during the transition.
2027-01-01
The EU-wide public repository of supervisory and resolution data requests is expected to become operational during Q1 2027; the precise date was not specified.
2027-06-30
The EBA expects to present further proposals on reporting change management in the first half of 2027; the precise date was not specified.
2027-12-01 Deadline
First reference date for the new supervisory reporting requirements, subject to finalisation, Commission adoption and the precise legal text; the announcement specifies December 2027 but not a day.
2028-12-01 Deadline
Expected reference period for deferred liquidity, asset-encumbrance, supervisory-benchmarking and ESG reporting changes; the announcement specifies December 2028 but not a day.
Suggested considerations
Firms should continue submitting currently applicable supervisory reporting templates until the revised ITS and technical package are legally adopted and applicable, rather than treating the announced simplifications as immediately effective.
Compliance and regulatory-reporting teams may wish to preserve existing reporting processes for operational-risk losses while removing or suppressing only data affected by the new granular operational-risk taxonomy, consistently with transition instructions.
Institutions participating in credit-risk or IFRS 9 benchmarking should continue using the 2026 ITS on supervisory benchmarking reporting during the transition and confirm whether they remain within the relevant benchmarking population.
Firms should assess the impact of the 1 January 2027 FRTB implementation position on reporting, capital, data lineage and systems, including whether existing interpretations need to be revised once the EBA consideration is final.
Reporting owners should maintain separate implementation workstreams for requirements expected from December 2027 and deferred areas expected from December 2028, including liquidity, asset encumbrance, benchmarking and ESG reporting.
Firms should monitor the EBA final ITS report in December 2026, the Commission adoption process and the technical package expected in early 2027, including the data point model, taxonomies and validation rules.
Institutions may wish to inventory national and supervisory data requests and identify duplicative submissions in anticipation of the EBA data-request guidance and EU-wide repository.
Change-management plans should account for possible revisions to templates, frequencies, thresholds, validation rules, reporting ownership and consolidated-level data aggregation once the final technical package is available.
What changed
The final package, scheduled for publication in December 2026, will further simplify reporting templates, reduce collateral, stress-testing and ESG data, remove selected reporting thresholds, reduce reporting frequencies and align reporting more closely with disclosure requirements. Credit-risk and IFRS 9 benchmarking reporting will be integrated into the supervisory reporting framework, with streamlined IFRS 9 requirements and greater emphasis on consolidated-level reporting.
Compliance impact
The announcement reduces near-term implementation pressure but creates a significant systems, data-governance and change-management programme for banks and other institutions within the ITS scope. Existing reporting obligations remain operative during the transition, and non-compliance with current templates, benchmarking submissions or applicable interim requirements may still create supervisory risk; the EBA expects the final package to reduce reporting costs while preserving information needed for effective supervision.
ESMA proposes simpler EU Taxonomy reporting 29 October 2026 Issuer disclosure Sustainable finance The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has published its Final Report providing technical advice to the European Commission on simplifying key…
AI Analysis
ESMA submitted technical advice to the European Commission on 29 October 2026 proposing targeted simplifications to the EU Taxonomy Disclosures Delegated Act. The advice would narrow the mandatory OpEx KPI to non-capitalised R&D expenditure, remove the weighted-average group KPI and simplify several undertaking, group and asset-manager disclosures, but it is not itself binding; the existing rules continue to apply unless and until the Commission amends the Delegated Act.
Key dates
2026-03-04
The European Commission issued its call for technical advice to the European Supervisory Authorities on targeted simplification of the Taxonomy Disclosures Delegated Act.
2026-07-01
ESMA launched its consultation on selected Taxonomy KPIs and proposed simplification measures.
2026-08-12 Deadline
ESMA’s consultation period closed.
2026-10-29
ESMA submitted its Final Report and technical advice to the European Commission for consideration in the review of the Taxonomy Disclosures Delegated Act.
Suggested considerations
Compliance teams should continue applying the currently effective Taxonomy Regulation and Taxonomy Disclosures Delegated Act until any Commission amendment enters into force.
Firms should monitor the Commission’s review of the Disclosures Delegated Act and assess any subsequent delegated act, scrutiny period, entry-into-force date and transitional provisions before changing reporting controls.
Corporate reporting teams may wish to model the effect of an R&D-only mandatory OpEx KPI, including the IAS 38 or national-GAAP population, numerator mapping and interaction with existing materiality reliefs.
Groups should inventory parent and subsidiary business lines, assess whether secondary businesses could exceed a cumulative 10% consolidated-turnover threshold, and prepare for possible parent-regime and simplified secondary-business templates.
Asset managers and other financial undertakings should avoid treating the proposed absence of voluntary OpEx reporting as current law and should document the basis for any voluntary Taxonomy metrics under existing disclosure and anti-greenwashing controls.
Issuers and sustainability-reporting teams should review sustainable-bond, internal-sales, contextual-information and CapEx Type C data processes so they can adapt if the Commission adopts ESMA’s recommendations.
Reporting governance should track whether any future voluntary alternative metric is reconciled to the mandatory KPI and subject to applicable ESMA Guidelines on Alternative Performance Measures.
What changed
ESMA recommends that the mandatory Article 8 Taxonomy Regulation OpEx KPI focus on non-capitalised R&D expenditure, with the denominator based on expenditure recognised under IAS 38 or relevant national GAAP and the numerator drawn from the existing Annex I categories. It does not recommend introducing a mandatory voluntary OpEx+ metric, and advises against allowing financial undertakings, including asset managers, to use an OpEx KPI voluntarily for Taxonomy disclosures.
Compliance impact
The immediate legal impact is limited because ESMA’s final report is technical advice rather than a binding amendment, and the Commission has not yet adopted revised disclosure rules. The practical impact could be material for Taxonomy reporting architecture, group consolidation, KPI data lineage and sustainability-reporting controls if the Commission adopts the recommendations; market commentary indicates that the Commission was expected to complete its review around Q1 2027, with possible application of new measures around Q3 2027, but those dates are not established deadlines in ESMA’s...
The European Banking Authority (EBA) has published its response to the European Commission’s Call for Technical Advice on certain key performance indicators (KPIs) and other aspects of the Disclosures Delegated Act under Article 8 of the Taxonomy Regulation. The EBA advises on targeted changes to streamline disclosure…
AI Analysis
On 29 October 2026, the EBA submitted technical advice to the European Commission proposing targeted simplifications to Article 8 Taxonomy disclosures for credit institutions and investment firms. The advice is not itself binding law; its practical significance is that it may shape the Commission’s forthcoming review of the Disclosures Delegated Act, with market commentary highlighting potential reductions in KPI and template burdens but also uncertainty until the Commission adopts amendments.
Key dates
2026-03-04
The European Commission requested technical advice from the ESAs on the review of Article 8 Taxonomy disclosures.
2026-10-29
The EBA published its final technical advice and submitted its report to the European Commission.
Suggested considerations
Compliance teams should treat the publication as forward-looking technical advice and should not cease reporting the Fees and Commissions KPI, Trading Book KPI or other existing disclosures unless and until the Commission adopts applicable amendments or transitional measures.
Firms should map current Taxonomy data lineage, controls, templates and calculation logic against each proposed change so that implementation can be accelerated if the Commission follows the EBA advice.
Banking groups should assess how parent-level KPIs and material secondary-activity KPIs could affect consolidation methodologies, entity-level data ownership and audit trails.
Investment firms should inventory fees, commissions and other services currently included in the relevant KPIs, particularly capital-markets-related services, and model the effect of the proposed narrower approach.
Credit institutions should review Green Asset Ratio template production and identify duplicated or low-value data points that may be removed or harmonised in a future delegated act.
Firms should monitor the Commission’s review of Commission Delegated Regulation (EU) 2021/2178, the related Omnibus simplification measures and any final ESA or Commission guidance before updating policies, public disclosures or regulatory reporting systems.
Legal and regulatory-change teams may wish to engage with the Commission consultation or legislative process and preserve evidence supporting current reporting interpretations during the transition.
What changed
The EBA recommends removing the Fees and Commissions KPI and the Trading Book KPI from Taxonomy disclosure requirements. It proposes simplifying the investment firms’ other-services KPI, including capital-markets-related services, and aligning grandfathering provisions with Regulation (EU) 2023/2631 on European Green Bonds, but only for bonds issued under that Regulation. The EBA advises against introducing the operational expenditure KPI of non-financial undertakings into financial undertakings’ KPI calculations.
Compliance impact
The immediate compliance impact is limited because the EBA advice does not amend the Taxonomy Regulation or the Disclosures Delegated Act and does not create a new filing deadline. The potential medium-term impact is material for banks, investment firms and groups because final Commission amendments could remove KPIs, alter group calculations and reduce or redesign disclosure templates; until then, firms should maintain applicable reporting and controls.
The document is a speech by Frank Elderson at COP17, so the content type is speech. It centres on nature as economic infrastructure and the economic case for nature investment.
The document is a speech by Frank Elderson (ECB Executive Board member) at the Green Swan 2026 Conference. It discusses climate and nature risks as systemic macroeconomic and financial risks, the adaptation/mitigation balance, the green transition as a competitiveness argument, and barriers to green investment such as...
The document is a keynote speech by Frank Elderson at an ECB-Bank of England conference. It is informational with no binding obligations or dates, so urgency is null.
ESMA sets out 2026 European Common Enforcement Priorities 13 October 2026 Financial reporting Issuer disclosure The European Securities and Markets Authority (ESMA), the European financial markets regulator and supervisor, has outlined the European Common Enforcement Priorities (ECEP) for the 2026 annual financial…
Why this matters
The document is ESMA's annual statement of supervisory priorities for issuers' annual financial reports, which fits the 'report' type. It covers IFRS financial statements, ESRS sustainability statements and ESEF digital reporting, so the topics are Reporting & Disclosure and ESG / Sustainability.
The Joint Committee of the European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) published today its Annual Work Programme for 2027, setting out its priorities for addressing cross-sectoral risks and strengthening coordination across the European Union's financial sector.
Why this matters
The document is the ESAs' Annual Work Programme announcement, which the classifier treats as a report on supervisory priorities. It is cross-sectoral across banking, insurance and markets, so 'General' applies and no specific sector is added.
ESMA promotes clarity in claims on impact and transition 12 October 2026 Sustainable finance The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has published two additional thematic notes on sustainability-related claims. Impact claims This thematic note examines…
AI Analysis
ESMA published two thematic notes on 2026-10-12 addressing positive impact claims and climate transition claims used in communications about funds, bonds and benchmarks. The notes do not create new regulatory requirements, but they signal that supervisors will expect sustainability claims to be specific, substantiated, balanced and transparent about methodologies, assumptions, data limitations and dependencies, particularly where claims concern real-world impact or future performance.
Key dates
2026-10-12
ESMA published the thematic notes on impact claims and climate transition claims.
Suggested considerations
Compliance teams may wish to inventory all impact and climate transition claims appearing in websites, fund marketing, factsheets, presentations, social media, bond materials and benchmark communications.
Firms should consider documenting the causal theory behind each positive impact claim, including the investment or financing activity expected to generate the impact and the distinction between intended, expected and achieved outcomes.
Firms should consider establishing measurable impact indicators, calculation methodologies, baselines, monitoring frequency and governance for reviewing whether claimed outcomes have occurred.
Firms making transition claims should consider documenting the transition objective, eligibility criteria, milestones, target dates, implementation actions, dependencies on investee companies or other parties, and the process for reporting slippage.
Marketing and product-governance reviews may wish to require prominent explanation of material assumptions, data gaps, estimates, methodological limitations and uncertainty surrounding forward-looking claims.
Firms should consider checking that claims are consistent across regulatory disclosures, marketing communications, portfolio holdings, bond frameworks, benchmark methodologies and public sustainability reports.
Compliance teams may wish to retain evidence supporting each claim and to review whether qualifying information is sufficiently clear, balanced and proximate to the claim rather than hidden in technical documentation.
Firms should consider assessing whether product names, labels, comparisons, impact figures and transition terminology could create an impression of guaranteed or already-achieved environmental or social outcomes.
What changed
ESMA has provided practical do's and don'ts for non-regulatory communications containing impact or climate transition claims, based on observed market practices. Firms communicating positive impact claims should explain the intended difference, the mechanism through which impact is expected to arise, and how outcomes will be measured. Firms making climate transition claims should describe the transition ambition, implementation approach, assessment of progress, relevant assumptions, data limitations and external dependencies.
Compliance impact
The immediate legal impact is limited because ESMA states that the notes are non-binding and introduce no new regulatory or reporting requirements. Their supervisory significance is nevertheless material: unclear, unsubstantiated or unbalanced sustainability communications may increase greenwashing, conduct and investor-protection risk under existing requirements, potentially leading to demands for remediation, supervisory scrutiny or enforcement under applicable national and EU frameworks.
The European Banking Authority (EBA) today released the final technical package for version 4.4 of its reporting and disclosure framework, covering IFRS 18 reporting, Pillar 3 ESG disclosures and other technical amendments.
Why this matters
The document is a formal technical release from the EBA covering the Phase 1 package for reporting framework version 4.4, including IFRS 18 FINREP templates, Pillar 3 ESG and FRTB disclosure templates, and corrections to DPM and taxonomy. It is not a consultation or policy statement.
This is a keynote speech from an ECB Supervisory Board member delivered at an industry conference. While not a binding rule or consultation, it provides noteworthy regulatory signals on supervisory expectations across multiple domains: credit risk management (loan granting practices, collateral valuations), capital...
ESMA sets new supervisory priority on digital innovation from 2027 23 September 2026 Digital Finance and Innovation Supervisory convergence The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, will launch a new Union Strategic Supervisory Priority (USSP) to help…
Why this matters
This is a speech by ESMA announcing a new Unified Supervisory Strategy Priority (USSP) on digital innovation effective 2027, focusing on AI and tokenisation oversight. The content provides strategic regulatory direction and signals future supervisory expectations across supervised entities.
The European Banking Authority (EBA) today published its latest Environmental, Social and Governance (ESG) risk dashboard, showing continued stability in banks’ transition and physical climate risk indicators across the EU/EEA in second half of 2025. The results also indicate gradual improvements in the availability…
Why this matters
This is an informational news release announcing the EBA's ESG risk dashboard results for H2 2025. It reports on climate risk exposures and data quality improvements across EU/EEA banks but does not impose new binding obligations or announce enforcement actions.
The European Banking Authority (EBA) today published a draft technical package for version 4.4 of its reporting and disclosure framework, covering IFRS 18 reporting, Pillar 3 ESG disclosures and other technical amendments.
AI Analysis
On 2026-07-24, the EBA opened consultation on the draft technical package for reporting framework version 4.4, covering IFRS 18 FINREP templates, Pillar 3 ESG disclosures, FRTB-related disclosure templates, and technical amendments to resolution planning, MREL, and AMLA eligibility data. The package matters because it sets the first reporting reference dates for several new or amended templates and gives firms an early view of the DPM 2.0 transition ahead of final publication expected in September 2026.
Key dates
2026-07-24
EBA published the draft technical package for reporting framework 4.4 and opened the consultation
2026-08-24 Deadline
Deadline for stakeholders to submit comments and suggestions on the draft technical package 4.4 and new glossary
2026-09-30
EBA expects to publish the final technical package for reporting framework 4.4
2026-12-31
First reference date for amended Pillar 3 ESG, equity and shadow banking disclosures; technical amendments for resolution planning, MREL decisions, Pillar 3 disclosure templates; and AMLA eligibility templates
2027-03-31
First reference date for new IFRS 18-aligned FINREP templates and FRTB-related disclosure templates
2027-12-31
First reference date for Pillar 3 ESG, equity and shadow banking disclosures for SNCIs
Suggested considerations
Compliance teams may wish to assess the draft 4.4 package against current reporting architecture, especially where FINREP, Pillar 3, FRTB, resolution planning, MREL, or AMLA templates rely on local mapping or vendor implementation.
Firms may wish to review the new IFRS 18-aligned FINREP templates and identify any chart-of-accounts, data lineage, or consolidation changes needed ahead of the 2027-03-31 first reference date.
Reporting teams may wish to map the updated Pillar 3 ESG, equity exposure, and shadow banking disclosures to the 2026-12-31 reporting cycle, and to 2027-12-31 for SNCIs.
Institutions may wish to compare their DPM 1.0 to DPM 2.0 conversion controls against the new glossary conversion file and plan for taxonomy or validation rule changes in downstream reporting tools.
Affected firms may wish to submit comments on the draft technical package and glossary by 2026-08-24 if they have implementation concerns, data gaps, or interpretation issues.
Compliance functions may wish to monitor the expected September 2026 final publication for changes to validation rules, AML eligibility elements, and the AMLA risk assessment 2027 templates.
What changed
The draft technical package for release 4.4 includes validation rules, the Data Point Model, XBRL taxonomies, and a new conversion file between DPM 1.0 and the DPM 2.0 glossary. It introduces amendments to the ITS on Pillar 3 disclosures on ESG risks, equity exposures and shadow banking exposures, with first reference dates of 2026-12-31 and 2027-12-31 for SNCIs. It also adds new IFRS 18-aligned FINREP templates, with a first reference date of 2027-03-31, and integrates FRTB-related disclosure templates into the DPM, also with a first reference date of 2027-03-31.
Compliance impact
The immediate impact is medium-high because the draft signals concrete reporting and disclosure changes with phased first reference dates, rather than a purely conceptual policy update. Firms that miss the data model and taxonomy changes risk implementation issues in supervisory reporting, disclosure production, and validation processing once the new templates become effective.
New Q&As available 10 July 2026 Digital Finance and Innovation Sustainable finance Trading The European Securities and Markets Authority (ESMA), the EU's securities markets regulator, has published the following question and answer: EU ESG Ratings Regulation (ESGRR) Consulting activities to investors or undertakings…
AI Analysis
Key dates
10 July 2026
- ESMA publishes the new Q&As on ESGRR, MiCA, and MiFIR secondary market topics
Suggested considerations
Review ESG ratings policies to ensure consulting, notification, issuer feedback, and factual error review procedures align with ESMA’s latest ESGRR Q&As.
Update internal case-handling workflows so notifications are screened for the designated contact issue and the two-working-day notification period is calculated consistently.
Document how your firm distinguishes internal-use ESG ratings or in-house financial services from externally provided ESG ratings activity.
Reassess whether any second-party opinion business can rely on the ESGRR exemption and record the legal basis for that conclusion.
Re-map MiCA permissions for custody, administration, transfer, and lending services to confirm the firm is not performing activities outside its authorisation scope.
What changed
- ESMA added a Q&A clarifying consulting activities to investors or undertakings under the EU ESG Ratings Regulation (ESGRR), which is relevant where a ratings provider’s advisory services may...
ESMA added Q&As on the application and scope of the two working day notification period under ESGRR, indicating that firms must apply the notification clock consistently and in line with ESMA’s...
ESMA clarified access to the dataset for factual error review under ESGRR, which affects how rated entities or issuers can review underlying data used in ESG ratings processes.
ESMA added a Q&A on notifications without a designated contact under ESGRR, which is relevant for governance and outreach workflows when a notification lacks an identified recipient.
ESMA clarified the obligation to consider issuer feedback under ESGRR, reinforcing that issuer comments cannot be ignored and must be handled through a documented review process.
Compliance impact
Non-compliance risk is high because these Q&As affect how firms interpret regulatory scope, notification timing, and operational controls across sustainability, crypto, and market structure regimes. Firms that ignore the guidance may face supervisory challenge, remediation costs, and potential findings that their current procedures, permissions, or disclosures are misaligned with ESMA’s expectations.
ESMA launches data collection under the first phase of ESAP 10 July 2026 Market data The European Securities and Markets Authority (ESMA), the EU regulator and supervisor, has launched the collection of information from Officially Appointed Mechanisms (OAMs) and National Competent Authorities (NCAs) - “collection…
Why this matters
ESMA announces first phase of ESAP data collection platform covering transparency, prospectus, and short-selling regulations. This is informational content about regulatory infrastructure development with July 2027 public launch deadline.
Financial firms keep EU carbon markets moving 09 July 2026 Trading The European Securities and Markets Authority (ESMA), the EU financial market regulator and supervisor, has published its t hird annual market report on EU carbon markets . The report shows that financial intermediaries are central to the functioning…
Why this matters
ESMA report on EU carbon market functioning and financial intermediaries' role. Informational content covering market structure, trading volumes, price movements, and regulatory recommendations on LEI implementation. No immediate compliance deadline or critical risk identified.
This is an ECB keynote speech providing regulatory guidance on climate and nature-related risks affecting monetary policy and financial stability. It addresses carbon pricing barriers, regulatory uncertainty, access to finance for green transition, and credit differentiation by banks based on emissions.
ESMA consults on simplifying EU Taxonomy disclosure framework 01 July 2026 Sustainable finance The European Securities and Markets Authority (ESMA), the EU financial markets regulator and supervisor, has launched a consultation on technical advice to the European Commission (EC) on selected KPIs under the Taxonomy…
Why this matters
ESMA consultation on simplifying EU Taxonomy disclosure framework for non-financial undertakings and asset managers. Focuses on reducing reporting complexity while maintaining investor relevance. Consultation period runs until August 2026 with final advice due October 2026.
ESMA publishes the register of external reviewers under the EuGB Regulation 22 June 2026 Supervision The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has today published the register of firms authorised to act as external reviewers of European Green Bonds…
Why this matters
ESMA announcement regarding the register of external reviewers under the European Green Bond Regulation. This is informational content about regulatory compliance requirements for firms conducting external reviews of green bonds, including transition from transitional regime to full supervision as of June 22, 2026.
ESMA 2025 Annual Report: focus on stronger supervision, regulatory simplification, and innovation 17 June 2026 About ESMA Board of Supervisors Management Board Press Releases The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has today published its Annual Report…
Why this matters
ESMA's annual report highlights 2025 regulatory achievements across multiple domains: MiCA and crypto-asset implementation, consolidated tape providers under MiFIR, T+1 settlement, DORA digital resilience, ESG/Green Bond regulations, and supervisory reporting simplification.
Interview with ECB Executive Board member discussing supervisory philosophy on capital requirements, regulatory simplification, banking union integration, and sustainability reporting thresholds. Informational content providing regulatory guidance rather than announcing new requirements.
ESMA publishes latest edition of its newsletter 01 June 2026 ESMA newsletter The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has published today the latest edition of its Spotlight on Markets newsletter , covering ESMA’s key activities and publications from…
AI Analysis
ESMA’s latest *Spotlight on Markets* newsletter (covering April–May 2026 activity) signals a coordinated push on reporting simplification, CCP resilience, EMIR 3 implementation and enhanced enforcement of corporate and digital reporting standards. For compliance teams, the newsletter is a consolidated forward‑looking risk map: it highlights where ESMA and NCAs will focus supervision and enforcement in the next cycle, especially around fund/transaction reporting, CCP crisis planning, ESEF taxonomy use and internal control functions in the funds sector.
Key dates
2025 (completed) Deadline
– ESMA and NCAs conduct the 2025 Common Supervisory Action on compliance and internal audit functions of fund managers, establishing benchmarks for good and poor practices in the funds sector
2025 (completed)
– First year of enforcement of European Sustainability Reporting Standards (ESRS) and application of ESMA Guidelines on Enforcement of Sustainability Information for in‑scope issuers’ 2025 reporting
2025 (throughout year)
– ESMA and NCAs carry out corporate reporting enforcement across the EEA, including financial, sustainability and digital (ESEF) reporting, feeding into ESMA’s 2025 corporate reporting enforcement report
Q2 2026
– ESMA launches the sixth CCP stress test exercise, with follow‑up supervisory actions by ESMA and NCAs expected after results are analysed
Q2 2026
– ESMA publishes reporting templates and instructions for the EMIR 3 Active Account Requirement, enabling firms and CCPs to begin design and implementation work ahead of EMIR 3 go‑live
Suggested considerations
Map your firm’s current EMIR, MiFIR and fund reporting obligations against ESMA’s stated objective of simplifying EU reporting frameworks and begin scenario‑planning for changes to templates, data models and validation rules.
For CCPs and clearing members, review participation in the sixth ESMA CCP stress test, ensure timely and accurate data delivery, and assess internal implications of potential stress test findings for risk management frameworks.
CCPs should compare existing recovery and resolution plans and playbooks against ESMA’s new guidance on effective use of resolution tools, updating governance, triggers, communications and coordination arrangements with resolution authorities.
Counterparties and CCPs in scope of EMIR 3 should identify products and business lines affected by the Active Account Requirement and begin implementing systems, processes and controls to populate ESMA’s reporting templates and instructions.
Investment firms active in equity markets should respond to ESMA’s call for evidence on European equity market structure where appropriate, and internally assess potential impacts on best execution, order routing, internalisation and transparency obligations.
What changed
- ESMA is advancing the simplification of EU reporting frameworks for funds and transaction reporting, indicating upcoming changes to reporting templates, data fields and/or reporting channels under...
ESMA has launched its sixth EU‑wide stress test exercise for Central Counterparties (CCPs), expanding supervisory scrutiny of CCP risk management, default management processes and resilience to...
ESMA has published guidance on the effective use of resolution tools in CCP crisis planning, clarifying expectations for CCP resolution planning, coordination with resolution authorities and use of...
ESMA has issued reporting templates and instructions for the Active Account Requirement under EMIR 3, operationalising new obligations for counterparties and CCPs to maintain and report active...
ESMA has published a call for evidence on the structure of European equity markets, opening a policy workstream that may lead to changes in market structure, transparency, and best execution...
Compliance impact
The overall impact is medium to high: while the newsletter itself does not create new binding obligations, it consolidates ESMA priorities that will drive supervisory focus and future technical standards, particularly in EMIR 3, CCP oversight, ESEF and sustainability reporting. Failure to anticipate and align with these priorities can lead to enforcement actions, remediation mandates, higher supervisory scrutiny and reputational risk once the related rules and guidance are fully applied.
New Q&As available 28 May 2026 Digital Finance and Innovation Market Abuse Sustainable finance The European Securities and Markets Authority (ESMA), the EU's securities markets regulator, has published the following question and answer: EU ESG Ratings Regulation (ESGRR) Defined ranking system (2853) Transitional…
AI Analysis
ESMA has released new Q&As clarifying several operational aspects of the EU ESG Ratings Regulation (ESGRR), the Market Abuse Regulation (MAR) delegated audit requirements, and an exemption from MiCA white paper obligations for certain crypto-asset offerings. These Q&As materially affect how ESG rating providers structure their methodologies and registrations, how firms plan and evidence MAR compliance audits, and when MiCA white papers are required, and therefore should immediately be integrated into internal compliance frameworks.
Key dates
03 January 2025
– ESG Ratings Regulation (ESGRR) enters into force, starting the formal legislative timeline and triggering preparatory obligations for future ESG rating providers
02 July 2026
– ESGRR applies and the main substantive requirements become effective; from this date entities have one month to notify ESMA of their intention to apply for authorisation or registration as ESG rating providers
Suggested considerations
Map all existing and planned ESG rating products against ESMA’s clarified concept of a “defined ranking system” and update methodologies, scales, and disclosures to ensure they meet ESGRR and Q&A expectations.
For ESG rating providers operating before 02 July 2026, develop and execute a documented transitional compliance plan that aligns governance, methodologies, data controls and transparency with ESGRR, ensuring timely notification to ESMA within one month from 02 July 2026.
For entities intending to launch ESG rating activities after ESGRR entry into force, prepare and submit complete authorisation or registration files to ESMA before commencing rating activity, incorporating the Q&A guidance on initial registration requirements.
Establish or enhance a formal process to identify, assess and record “material changes to registration information” for ESG rating providers, and implement controls to ensure ESMA is notified within required timelines before or immediately after such changes, as specified in the Q&A.
Review and update MAR compliance frameworks, with particular focus on market soundings procedures, to incorporate ESMA’s expectations on the scope, independence, and documentation of the annually conducted audit required under Commission Delegated Regulation (EU) 2016/957.
What changed
- ESMA clarifies what constitutes a “defined ranking system” under the EU ESG Ratings Regulation (ESGRR), including when rating scales, score bands or league tables will be regarded as a ranking...
ESMA sets out transitional provisions for existing ESG rating providers active before ESGRR application, detailing conditions and timelines under which they may continue operating while completing...
ESMA explains how ESG rating providers established after the ESGRR date of entry into force must comply, including the need to obtain authorisation/registration before commencing activity in the EU...
ESMA defines what qualifies as “material changes to registration information” for ESG rating providers under ESGRR, indicating the types of changes (e.g.
Under MAR and Commission Delegated Regulation (EU) 2016/957, ESMA clarifies expectations regarding the annually conducted audit of market soundings arrangements, including scope, independence of the...
Compliance impact
Non-compliance with ESGRR, MAR and MiCA as interpreted in ESMA’s Q&As may lead to authorisation refusals or withdrawals, administrative fines, product restrictions, and heightened supervisory scrutiny. Given the enforcement nature of ESG ratings supervision and MAR/MiCA regimes, firms face significant conduct, reputational and business model risks if they fail to align promptly with this guidance.
ESMA outlines enforcement activities for corporate reporting across the EEA in 2025 07 May 2026 Corporate Finance Electronic reporting Financial reporting Sustainable finance The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has today published its Report on…
ESMA promotes proportionate supervision of MiFID II sustainability requirements 06 May 2026 Investor protection The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has issued a statement presenting the results of its Common Supervisory Action (CSA) on how…
ESMA consults on guidelines on endorsement under the ESG Ratings Regulation 29 April 2026 Credit Rating Agencies The European Securities and Markets Authority (ESMA) has launched a public consultation on draft guidelines on endorsement under the ESG Ratings Regulation 1 . The consultation paper sets out ESMA’s…
Joint Committee annual report highlights digitalisation, cyber resilience and sustainable finance as key priorities of 2025 24 April 2026 Joint Committee The Joint Committee of the European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) today published its Annual Report for 2025 , setting out the main…
ESAs spring risk update highlights geopolitical pressures and rising private finance risks 27 March 2026 Joint Committee Risk monitoring The European Supervisory Authorities (EBA, EIOPA and ESMA – the ESAs) today published their spring 2026 Joint Committee update on risks and vulnerabilities in the EU financial…
Why this matters
The regulatory update highlights significant geopolitical risks and emerging risks in private finance that could impact the financial sector, particularly banks, asset managers, and insurers. Supervisors and firms are called to maintain vigilance and proactively assess and manage these risks.
This regulatory update discusses the impact of physical climate risks on the banking sector and the role of insurance in mitigating these risks. It is relevant for banks and insurance firms in terms of prudential requirements and ESG/sustainability considerations.
This regulatory update from the ECB discusses the resilience of European banks, including their preparedness for geopolitical risks, interest rate changes, and non-performing loans.
This regulatory update from the ECB covers key supervisory priorities and activities related to the resilience of the euro area banking sector, including managing geopolitical risks, credit risk, operational resilience, climate/environmental risks, and data aggregation/reporting.
ESMA sets out actions to simplify the retail investor journey and make investing more accessible 12 March 2026 Investor protection Press Releases The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has published its takeaways from the 2025 Call for Evidence (CfE)…
Why this matters
This regulatory update from ESMA focuses on simplifying the retail investor journey and making investing more accessible. It covers key areas such as streamlining disclosure requirements, reducing complexity in suitability and appropriateness assessments, and simplifying MiFID II requirements on sustainability...
This regulatory update from the ECB discusses the importance of incorporating nature-related risks into banking supervision and financial stability assessments. It is highly relevant for banks, asset managers, and wealth managers who need to manage these emerging environmental risks.
New investment funds drive reduction in costs to investors 03 March 2026 Fund Management Press Releases Risk monitoring The European Securities and Markets Authority (ESMA), the EU financial markets regulator and supervisor, today publishes its 2025 market report on the costs and performance of EU retail investment…
Why this matters
This regulatory update from ESMA discusses trends in costs and performance of investment funds in the EU, including UCITS, AIFs, and structured retail products. It covers topics related to consumer protection, ESG, and disclosure requirements that are relevant for asset managers, broker-dealers, and wealth managers.
This regulatory update from the ECB covers key supervisory priorities for 2026-2028, including initiatives related to credit underwriting and geopolitical risk stress testing. These initiatives impact banks, asset managers, and wealth managers, and touch on prudential, operational, and sustainability-related topics.
This regulatory update from the ECB covers topics related to banking supervision, climate risk management, and regulatory reporting requirements, which are relevant for banks, asset managers, and wealth managers.
ESMA supports the simplified European Sustainability Reporting Standards and suggests targeted adjustments 18 February 2026 Issuer disclosure Press Releases Sustainable finance The European Securities and Markets Authority, the EU’s financial markets regulator and supervisor, has delivered its opinion on the draft…
AI Analysis
ESMA has issued an opinion supporting EFRAG's draft simplified European Sustainability Reporting Standards (ESRS) under the CSRD, praising improvements in readability and materiality focus while recommending targeted adjustments to enhance investor protection and financial stability. This matters for compliance professionals as it signals upcoming refinements to sustainability disclosures, with pragmatic supervision promised during the transition, potentially reducing short-term burdens but requiring monitoring of final delegated act adoption by summer 2026.
Key dates
Summer 2026
- European Commission aims to adopt revised ESRS into a delegated act, considering ESMA, EBA, EIOPA, ECB opinions
FY 2029 (reporting in 2030)
- End of certain temporary reliefs on quantitative information for anticipated financial effects (if ESMA recommendations adopted)
First years post
adoption (2026+); - Learning curve period with pragmatic NCAs supervision and flexibility in examinations
Suggested considerations
Monitor Commission process: Track final delegated act by summer 2026, incorporating ESMA/EBA/EIOPA/ECB opinions; review full ESMA opinion PDF for detailed recommendations.
Assess current reporting: Evaluate use of permanent/temporary reliefs (e.g., #3/#4 on quantitative data, #9/#11 on metrics) and prepare for time limits; refine transition plans for emissions/targets.
Enhance governance disclosures: Strengthen reporting on sustainability competences in management/supervisory bodies and financial resources for actions.
Review subsidiary exemptions: Check materiality exclusions for sustainability risks/opportunities in consolidated statements.
Prepare for supervision: Leverage NCAs flexibility during transition; integrate into data governance and risk systems per CSRD implementation trends.
What changed
The draft revised ESRS introduce simplifications such as improved readability, language, format, reduced volume of requirements, and a focus on material matters.
Introduce time limits to certain permanent reliefs (e.g., reliefs #3, #4, #9, #11 on quantitative information for anticipated financial effects until FY 2029, and metrics).
Refine requirements on transition plans (e.g., consistent disclosure of absolute financed emissions and contextual information).
Strengthen reporting on sustainability competences of administrative, management, and supervisory bodies.
Enhance transparency on financial resources allocated to sustainability actions.
Compliance impact
Urgency: Medium - Not yet finalized (pending summer 2026 adoption), with pragmatic supervision promised, reducing immediate pressure; however, matters due to potential tightening of reliefs and disclosures impacting FY2026+ reporting, investor protection focus, and interoperability needs. Firms should prioritize if heavily using reliefs or with complex transition plans, as non-adjustment risks supervisory scrutiny post-learning curve.
ESMA publishes latest edition of its newsletter 13 February 2026 ESMA newsletter The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, has published today its latest edition of the Spotlight on Markets Newsletter. This edition opens with ESMA’s Digital and Data…
Why this matters
This regulatory update from ESMA covers several key areas including data and digital strategies, post-trade transparency for OTC derivatives, cooperation with other regulators, and various publications on ESG and risk-based supervision.
The ECB imposed a €7.55 million periodic penalty payment on Crédit Agricole for failing to complete a climate-related and environmental (C&E) risk materiality assessment by the May 31, 2024 deadline, marking the second enforcement action in the ECB's escalating shift from guidance to active enforcement on climate risk supervision. This enforcement demonstrates that the ECB is moving beyond symbolic warnings to substantial financial penalties, signaling that banks must treat climate risk identification and assessment as mandatory compliance obligations rather than discretionary best practices.
Key dates
2020
- ECB published non-binding Guide on climate-related and environmental risks
related and environmental risks, documenting exposure across the portfolio
*Near-term (H1 2026):
related risks into existing credit risk, operational risk, and market risk frameworks
testing purposes
What changed
The ECB's enforcement action reflects several critical regulatory developments: Mandatory Climate Risk Materiality Assessment Banks must now conduct comprehensive materiality assessments of climate-related and environmental risks as a binding supervisory requirement, not a guidance recommendation. The assessment must identify all material C&E risks to which the institution is or might be exposed. Binding Supervisory Decisions with Enforcement Teeth The ECB has transitioned from non-binding guidance (2020) to legally binding decisions with accruing daily penalties for non-compliance.
This regulatory update from the ECB covers changes to banking supervision, including potential revisions to capital requirements, proportionality for smaller banks, and the use of Additional Tier 1 capital.
This regulatory update from the ECB focuses on advancing their climate and nature-related work, which is relevant for banks, asset managers, and wealth managers from an ESG and prudential perspective.
ESMA promotes clarity in communications on ESG strategies 14 January 2026 Sustainable finance The European Securities and Markets Authority (ESMA), the EU’s financial markets regulator and supervisor, published today a second thematic note on sustainability-related claims, focusing on ESG strategies. The note…
AI Analysis
ESMA published a thematic note on January 14, 2026, providing guidance on clear, fair, and not misleading communications regarding ESG strategies, specifically ESG integration and ESG exclusions, to mitigate greenwashing risks in non-regulatory materials like marketing. This matters because sustainability claims heavily influence investor decisions, and misleading communications can lead to supervisory actions, reputational damage, and loss of trust, aligning with existing EU rules under SFDR and related frameworks without imposing new disclosures.
Key dates
1 July 2025
- Publication of ESMA's first thematic note on ESG credentials (to be read in combination)
14 January 2026
- Publication date of the thematic note on ESG strategies (second in series)
Suggested considerations
Review and update all non-regulatory ESG communications (marketing, websites, presentations, DDQs, PPMs) against the four principles and do's/don'ts.
Ensure consistency across channels, substantiate claims with accessible evidence, and avoid vagueness or overstatements.
Train compliance/marketing teams; monitor for updates as further thematic notes may follow.
Cross-reference with first note and regulations like SFDR, Cross-Border Distribution Regulation.
What changed
This is not a formal regulatory change but supervisory guidance reinforcing four principles for non-regulatory communications (e.g., marketing materials, websites, investor presentations, voluntary...
Accurate: Claims must fairly represent sustainability profiles without exaggeration, falsehoods, omissions, cherry-picking, vagueness, or misleading ESG terminology/imagery.
Accessible: Information must be easy to understand and navigate, with layered substantiation in electronic formats for retail materials.
Substantiated: Backed by clear reasoning, facts, processes, and methodologies; disclose data limitations and comparison bases.
Up to date: Reflect current data, with timely disclosure of material changes and analysis dates. Practical do's/don'ts include explaining ESG processes in plain language, disclosing portfolio...
Compliance impact
Urgency: High – Immediate risk of enforcement for greenwashing in high-visibility ESG marketing, amid rising supervisory scrutiny; non-compliance threatens fines, remediation, and reputational harm as investor focus on sustainability grows. Proactive alignment builds trust and differentiates firms.
ESAs publish joint Guidelines on ESG stress testing 08 January 2026 Guidelines and Technical standards Joint Committee The European Supervisory Authorities (EBA, EIOPA and ESMA - the ESAs) published today their Joint Guidelines on environmental, social, and governance (ESG) stress testing . These Guidelines provide…
AI Analysis
The European Supervisory Authorities (ESAs)—EBA, EIOPA, and ESMA—published final Joint Guidelines on 8 January 2026 to standardize how national competent authorities (NCAs) integrate ESG risks into supervisory stress testing frameworks for banking and insurance sectors, without mandating new ESG-specific tests. These guidelines promote consistency, long-term methodologies, and common standards across the EU, initially prioritizing climate and environmental risks (physical and transition) before expanding to social and governance factors. They matter for compliance professionals as they shape future supervisory expectations, enhancing resilience assessments and aligning with CRD (Article 100(4)) and Solvency II (Article 304c(3)) mandates, potentially influencing firm-level stress testing preparations.
Key dates
08 January 2026
Publication of Final Report and Joint Guidelines by ESAs
10 January 2026 Deadline
Statutory deadline for ESAs to publish guidelines per CRD Article 100(4) and Solvency II Article 304c(3)
Two months after official EU translations (expected ~March/April 2026) Deadline
NCAs notify respective ESAs of compliance or intent to comply
01 January 2027
Application date of Joint Guidelines for NCAs
Suggested considerations
For NCAs: Review and integrate ESG risks into stress testing frameworks via materiality assessments; define objectives, scenarios, and governance; notify ESAs of compliance post-translation; maintain risk-based, phased approach.
For Firms: No direct mandates, but prepare by enhancing internal ESG risk modeling, data collection (especially climate/physical/transition risks), and stress testing capabilities to align with supervisory expectations; conduct voluntary ESG scenario analyses.
General: Monitor NCA implementations, update policies for ESG risk integration in ICAAP/ORSA, and engage in industry feedback on data/methodological gaps.
What changed
- Standardized Integration of ESG Risks: NCAs must embed ESG risks into existing supervisory stress tests or ad-hoc assessments, using a risk-based materiality assessment to scope relevant risks,...
Methodological and Governance Guidance: Outlines design for ESG-inclusive tests, including objectives (e.g., capital/liquidity robustness, strategy resilience), scenario analysis, and organizational...
No New Obligations: Does not require NCAs to conduct dedicated ESG stress tests, but ensures consistency when they do, improving legal certainty and transparency in approval processes.
Phased Approach: Initial focus on climate/environmental risks, with gradual extension to full ESG coverage based on data and model maturity.
Compliance impact
Urgency: Medium. While not imposing immediate firm-level requirements, the guidelines signal escalating supervisory focus on ESG risks from 2027, with potential for more frequent/punitive stress tests; firms delaying ESG integration risk capital/liquidity shortfalls in exercises, amplified by improving data availability and EU sustainability push (e.g., CSRD, SFDR). Proactive preparation mitigates future remediation costs and supports strategic resilience.
New Q&As available 19 December 2025 Digital Finance and Innovation Fund Management Market Abuse Prospectus Sustainable finance The European Securities and Markets Authority (ESMA), the EU's securities markets regulator, has published or updated the following Questions and Answers: Alternative Investment Fund Managers…
AI Analysis
ESMA published new Q&As on December 19, 2025, addressing practical implementation questions across multiple regulatory frameworks including AIFMD, ESG rating activities, and sustainable finance rules. These guidance documents clarify regulatory expectations and promote consistent supervisory approaches across EU member states, making them essential for firms operating in affected areas to ensure compliant implementation.
Key dates
30 June 2025
- ESMA's final report on prospectus ESG disclosure requirements became effective (referenced in search results as June 6, 2025 publication date)
22 September 2025
- ESMA published updated consolidated Q&A on SFDR and Level 2 Regulation with new PAI disclosure guidance
17 October 2025
- ESMA updated MiCAR Q&As on execution service classification
19 December 2025
- ESMA published new Q&As across multiple regulatory domains
Suggested considerations
*Immediate (0-30 days):
*Short-term (1-3 months):
level information
advertised securities per Annex 21 requirements
What changed
The December 19, 2025 Q&A publication covers several regulatory domains:
AIFMD Exclusion Criteria: New guidance on the UNGC/OECD Guidelines exclusion (Q&A 2734), clarifying when alternative investment fund managers must apply exclusion-related requirements
ESG Rating Activities: Updated Q&As addressing regulatory requirements for ESG rating providers, including clarification on group-affiliated small ESG rating activities
Sustainable Finance: Continued development of guidance under SFDR and related sustainability disclosure frameworks
Digital Finance and Innovation: Guidance supporting implementation of digital finance rules
ESMA reviews impact of Guidelines on ESG or sustainability related terms in fund names 17 December 2025 Risk monitoring Sustainable finance The European Securities and Markets Authority (ESMA), the EU’s financial market regulator and supervisor, released research today assessing the impact of its fund naming…
Why this matters
This regulatory update from ESMA focuses on the impact of guidelines related to the use of ESG and sustainability-related terms in fund names, which is relevant for investment management firms and wealth managers.
This regulatory update from the ECB discusses the importance of resilient banks in building Europe's economic growth, highlighting topics related to prudential requirements, operational resilience, and ESG considerations.
This regulatory update from the ECB discusses the importance of effective supervision for building resilient banks, which is a key pillar of Europe's competitiveness.