ESMA launches common supervisory action with NCAs on sustainability-related disclosures

On 6 July 2023, the European Securities and Markets Authority (ESMA) announced that it has launched a common supervisory action (CSA) with Member State competent authorities (NCAs) on sustainability-related disclosures and the integration of sustainability risks.

The CSA will be conducted throughout the remainder of 2023 until Q3 2024, and during this period NCAs are expected to share their knowledge and experiences through ESMA to promote convergence in how they supervise sustainability-related disclosures and sustainability risk integration in asset managers.

The aim of the CSA is to assess the compliance of asset managers with the relevant provisions in the Sustainable Finance Disclosure Regulation (SFDR), the Taxonomy Regulation and relevant implementing measures, including the provision in the UCTIS and AIFMD implementing acts on the integration of sustainability risks.

The main objectives of the CSA are:

• to assess whether market participants adhere to applicable rules and standards in practice;
  
  
• to gather further information on greenwashing risks in the investment management sector, which will provide input to ESMA’s final report on greenwashing; and
  
  
• to identify further relevant supervisory and regulatory intervention to address the issue.

The CSA follows ESMA’s supervisory briefing on sustainability risks and disclosures in the area of investment management, which was published in June 2022 (see our earlier blog post).