|Author (Corporate)||European Commission|
|Series Details||COM (2018) 354|
Legislative initiative published by the European Commission in May 2018, aiming to set up disclosure obligations on how financial companies integrate environmental, social and governance (ESG) factors in their investment decisions.
The Commission's proposal requires disclosure of the procedures financial actors have in place to integrate ESG risks into their investment and advisory processes, as well as the extent to which ESG risks are expected to have an impact on the returns of the product or service provided, irrespective of whether or not sustainable investment objectives are pursued. In addition, if asset managers or institutional investors claim that they pursue a strategy with sustainability investment objectives, they would have to provide information on how they adhere to those sustainability objectives in their investment decisions.
The proposed Regulation is part of package of measures on sustainable development, following up on an Action Plan released in March 2018 which aims to boost the role of finance in achieving a well-performing economy that also delivers on environmental and social goals. It was adopted by the European Commission on 24 May 2018. The European Parliament adopted its negotiating position on 14 November, followed by the Council of the European Union in December 2018. An informal agreement between the co-legislators on a draft text was reached on 7 March 2019. The Parliament formally endorsed it on 18 April, followed by the Council on 8 November.
|Subject Categories||Business and Industry, Environment|
|Subject Tags||Capital Markets Union [CMU], Climate Change, Financial Services, Sustainable Economy|
|International Organisations||European Union [EU]|