The European Banking Authority (EBA) today launched an industry survey to receive input from credit institutions on their methodologies to classify exposures to environmental, social and governance (ESG) risks, as well as on the accessibility and availability of ESG data for this purpose. The objective of the survey is to collect qualitative information on credit institutions’ current practices to inform the EBA’s work on the feasibility of introducing a standardised methodology to identify and qualify exposures to ESG risks. The deadline to respond to the industry survey is 29 March 2024.
Background and next steps
As part of the revised banking package, the EBA will receive new mandates under Article 501c of amended Regulation (EU) No 575/2013 (see provisional agreement).
This survey is launched with a purpose to respond to points (a) and (b) of that article, which request the EBA to assess the following:
- availability and accessibility of relatable and consistent ESG data;
- feasibility of introducing a standardised methodology to identify and qualify exposures [subject to ESG risks], based on a common set of principles for ESG risk classification, using:
- information on transition and physical risk indicators made available by sustainability disclosures reporting frameworks (EU and internationally);
- guidance and conclusions coming from the supervisory stress-testing or scenario analysis of climate-related financial risks conducted by the EBA or the competent authorities;
- relevant ESG score of the ECAI credit risks rating by a nominated ECAI, if appropriately reflecting the ESG risks.
