The Financial Conduct Authority has updated its Regulatory Initiatives Grid for February 2023, setting out the UK regulatory pipeline for the next 24 months. The Grid was delayed from November 2022 to allow the regulators to consider the implications of the Edinburgh Reforms on the regulatory pipeline. The Grid is also available in the form of an interactive dashboard and an Excel spreadsheet.
Key updates in relation to ESG include the following:
UK Green Taxonomy: The Government is reviewing its approach to taxonomy developments and will be providing an update in the Green Finance Strategy ‘in the coming months’.
Climate-related requirements for pensions: The Pensions Regulator will launch a new regulatory initiative to assess compliance with the new climate-related requirements for statement of investment principles and implementation reports.
June 2023 (provisional)
Sustainability disclosure requirements (SDR) and investment product labels for asset managers: Following its consultation for SDR and investment labels for asset managers, (see our earlier blog post), the FCA intends to publish a policy statement with finalised rules in Q2 2023. Further parts of the overall SDR regime will be consulted on by relevant Government departments and regulators in due course.
ESG data and ratings: Following a Treasury consultation in Q1 2023 on bringing ESG rating providers within the FCA’s regulatory remit, the FCA will consult in the Summer on a Code of Conduct for ESG data and rating providers with the aim to finalise it in Q4 2023.
Q4 2023/Q1 2024
Diversity in Financial Services: Following their joint discussion paper (DP2/21) published in July 2021 (see our earlier blog post), the FCA and PRA intend to publish their policy proposals to support progress on improving diversity and inclusion in the financial sector. A consultation is expected in H1 2023.
Implementing International Sustainability Standards Board (ISSB) disclosure standards into FCA listing or transparency rules: The FCA expects to consult towards the end of 2023, with the final rules in the first half of 2024, although timing may be subject to the Government’s response to the ISSB standards which are due to be finalised in June 2023 (see our earlier blog post).