ESG: ESMA consults on draft RTS under ESG Rating Regulation

What's New

On 02 May 2025, the European Securities and Markets Authority (ESMA) released a consultation paper on draft regulatory technical standards (RTS) under the Regulation on the transparency and integrity of ESG rating activities (the ESG Rating Regulation).

The ESG Rating Regulation was published in the Official Journal on 12 December 2024 and will apply from 02 July 2026. For more information, see our client note here.

To facilitate the implementation of the new Regulation, ESMA was mandated to develop RTS in the areas of authorisation, recognition, separation of activities, and disclosures.

The draft RTS, which can be found in the annexes of the consultation paper, cover the following aspects of the regulatory framework:

1. The information that should be provided in applications for authorisation or recognition of ESG rating providers operating in the EU;

2. The measures and safeguards that should be implemented within ESG rating providers who carry out activities other than the provision of ESG ratings to mitigate risks of conflicts of interest. These are grouped into organisational requirements that are applicable to all ESG rating providers, and more specific requirements that apply in the case of certain specified activities; and

3. The information to be disclosed by ESG rating providers to the public, users of ESG ratings, rated items and issuers of rated items. This aims to ensure that ESG rating providers disclose the required information in a comparable and consistent manner.

Next Steps

The consultation closes on 20 June 2025. ESMA expects to publish a final report in Q4 2025 and submit the draft RTS to the European Commission by the end of October 2025.