ESG Ratings – Global Investment Law Watch

Australia: Regulation for ESG Ratings Agencies Gathers Pace

Jul 18 2023

With increased demand for “ESG friendly” investments (in an ESG investment market on track to exceed US $53 trillion globally by 2025), asset managers, funds management companies, superannuation funds and other investors are actively turning to ESG ratings agencies to guide their decisions.

As it currently stands, there is significant potential for discrepancy in the ratings being produced. This is confusing and potentially misleading for investors and may also divert capital away from its intended direction.

Europe: UK Government Proposes To Regulate ESG Ratings Providers

Apr 11 2023

By Philip Morgan and Zainab Kuku

Responding to encouragement from both the FCA and IOSCO, HM Treasury has proposed regulating ESG ratings providers in a consultation paper dated 30 March 2023. It primarily aims to improve the transparency of the methodologies and governance objectives adopted by ESG ratings providers, as well as to mitigate risks arising from conflicts of interest where the rating provider also provides other services to the rated entity.

Tag:ESG Ratings