The European Supervisory Authorities (ESMA, EBA and EIOPA) have issued a Call for Evidence, looking for feedback on potential greenwashing practices across the EU financial sector.
The European Commission wrote to the ESAs in May 2022, asking for:
- input on the occurrence of greenwashing,
- feedback on the potential for greenwashing risks, and
- an overview and assessment of supervisory practices, experience, convergence and capacities relating to the prevention of greenwashing.
The Call for Evidence contains a section common to all three ESAs and separate sections relevant to each ESA. One of the key areas in which the ESAs are seeking feedback as part of the cross-sectoral section is a draft list of potential 'core characteristics' of greenwashing.
The deadline for responses to the Call for Evidence is 10 January 2023. The ESAs have been asked to deliver a progress report by end-May 2023, and a final report by end-May 2024.
The Call for Evidence comes at a particularly busy time for the ESAs from an ESG perspective. Earlier this week, the ESAs published their letter to the Commission confirming that they need at least an additional 6 months to deliver on their mandate to prepare (at the request of the Commission) potential changes to the Delegated Regulation under the Sustainable Finance Disclosures Regulation (SFDR) relating to indicators for principal adverse impact and financial product disclosures - the Commission had asked for a proposal by April 2023, but the ESAs envisage needing a further 6 months. Among the reasons given for the delay were that the ESAs had needed to prioritise the Commission's separate mandate on amendments to the SFDR Delegated Regulation concerning fossil gas and nuclear energy (the ESAs delivered those final draft regulatory technical standards to the Commission at the end of September 2022), the scale of public/expert consultation needed, the importance of developing a more objective basis for the 'do no significant harm' principle and the need to expand on social indicators.
This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.