The European Securities and Markets Authority (ESMA) has opened a public consultation on proposed rules aimed at regulating ESG rating providers.
The draft Regulatory Technical Standards (RTS) outline several requirements for these providers, including the type of information that must be submitted when applying for authorisation or recognition.
The standards also set expectations for internal safeguards to manage potential conflicts of interest, particularly for providers offering services beyond ESG ratings. Additionally, the RTS specify the level of transparency required, including disclosures to the public, rated entities, issuers, and users of ESG ratings.
ESMA is inviting feedback from stakeholders until 20 June 2025. Following this period, the regulator plans to finalise the standards and submit them to the European Commission for adoption in October 2025.
The consultation is particularly relevant for firms intending to seek registration as ESG rating providers, as well as financial institutions, users of ESG scores, and rated companies.
The full consultation paper is available here.
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