The European Supervisory Authorities (ESAs) have issued a joint consultation paper on the Delegated Regulation of the Sustainable Finance Disclosure Regulation (SFDR).
The 158-page report – co-written by the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA) – contains a raft of proposed changes to the disclosure framework to address issues it says have emerged since the introduction of the SFDR.
The three bodies have proposed a number of changes, including the expansion of social issues that must be disclosed; revising certain definitions and methodologies used in determining disclosure regulations; and requiring the disclosure of decarbonisation targets.
The three bodies said comments on the Consultation Paper would be open until the beginning of July and can be made via the response form. They also said they would organise a joint public hearing and targeted consumer testing during the consultation period. After considering the comments received, the ESAs will prepare a Final Report and submit it to the European Commission.
Review and revise
In April last year, the three bodies received a mandate from the European Commission to review and revise the Regulatory Technical Standards laid down in the SFDR Delegated Regulation. The ESAs informed the Commission in October 2022 they would deliver the Final Report under the mandate by the end of October 2023.
Commenting on the move, Patrik Karlsson, senior policy officer at ESMA, said: “What started as a targeted amendment exercise grew into something more ambitious as we examined more aspects of the whole Level 2 SFDR framework. I hope all those interested in SFDR disclosures take the opportunity to contribute with much needed feedback by July so that we can calibrate the framework appropriately.”