Sustainable Finance

State of play: revision process

Level 1

Commission

• 20 February 2020, the Commission launched a public consultation on the review of the Non-Financial Reporting Directive, as part of its strategy to strengthen sustainable investment in Europe.

State of play: legislative phase

Level 1

Commission

• 24 May 2018, the proposal was published as part of a reforms package.

Council

• 25 September 2019, the Council adopted its negotiating position on taxonomy.
• 17 December 2019, the COREPER adopted the trilogue agreement.

Parliament

• 16 November 2018, the ENVI and ECON Committees published a draft report on the proposal.
• 17 December 2018, the ECON Committee published the amendments tabled on taxonomy: Link 1 and Link 2.
• 11 March 2019, the ECON Committee adopted the report.
• 28 March 2019, the Parliament adopted its position on taxonomy in plenary.
• 16 December 2019, the Parliament and the Council reached an agreement on taxonomy.
• 23 January 2020, the ECON and ENVI Committees approved the provisional agreement.

Level 2

• 18 June 2019, the TEG published its technical report on the classification system for environmental-sustainable economic activities (taxonomy).
• 4 July 2019, the TEG launched a call for feedback on the taxonomy report.
• 9 March 2020, the TEG published its technical report on the EU’s classification of green economic activities (taxonomy).

Next Steps

• Final approval and publication in the Official Journal.
• According to the Council position, the taxonomy should be established by the end of 2021, in order to ensure its full application by end of 2022.
• Level 2 measures are expected to be published by end 2020 and end 2021.

State of play: pre-legislative phase

• 20 March 2019, the Joint Research Centre published the preliminary report on EU Ecolabel criteria for financial products.
• 20 March 2019, the JRC published the technical report with scope and criteria proposals on EU Ecolabel for retail financial products.
• 20 December 2019, the JRC published the second technical report with scope and criteria proposals for the development of EU Ecolabel for retail financial products.

Next Steps

• It is expected that the next JRC stakeholder meeting will take place in March 2020, and the actual adoption will be postponed to 2021.
• The third technical report is expected in September 2020.

State of play: pre-legislative phase

Level 1

• 6 March 2019, the TEG published the interim report on Green Bond Standards.
• 18 June 2019, the TEG published the final report on Green Bond Standards.
• 9 March 2020, the TEG published the final report on Green Bond Standards.

Next Steps

• The Commission will include this project in its consultation on Sustainable Finance.
• At this stage the Commission is considering a legislative proposal.

State of play: pre-legislative phase

Level 1

Commission

• December 2016, the Commission set up a High-Level Expert Group on sustainable finance.
• 13 July 2017, the HLEG published the interim report on sustainable finance and launched a consultation.
• 13 November 2017, the Commission launched a two-month public consultation on institutional investors and asset managers’ duties regarding sustainability.
• 31 January 2018, the HLEG published the final report on sustainable finance.
• 8 March 2018, the Commission published its Action Plan on Sustainable Finance.
• 24 May 2018, the Commission published a number of proposals aimed at financing sustainable growth:
  namely a proposal on Taxonomy, a proposal on sustainable investment disclosure duties, a proposal on positive carbon benchmarks, and two delegated acts on MiFID and IDD.
• 10 January 2019, the Technical Expert Group published a report on climate-related disclosures.
• 30 January 2019, the Commission published a reflection paper on a more sustainable Europe by 2030.
• 18 June 2019, the Commission published guidelines on reporting climate-related information.
• 30 September 2019, the Technical Expert Group on Sustainable Finance (TEG) issued its final report on climate benchmarks and makes recommendations on a set of minimum technical requirements for the methodology of EU Climate benchmarks.
• 9 March 2020, the TEG on Sustainable Finance issued two reports on taxonomy and on the EU green bond standard.

Parliament

• 2 February 2018, the ECON Committee published the draft report on sustainable finance.
• 21 February 2018, the ECON Committee held a public hearing on sustainable finance.
• 24 April 2018, the ECON Committee adopted its draft report on sustainable finance.

Level 2

• 19 December 2018, ESMA launched a consultation on integrating sustainability risks and factors in MiFID II, and in the UCITS Directive/AIFMD.
• 25 February 2019, ESMA published the responses received to its consultations on integrating sustainability risks and factors in MiFID II and in the UCITS Directive/AIFMD.
• 30 April 2019, ESMA published a final report on environmental, social and good governance considerations for investment firms and funds under MiFID II, AIFMD and UCITS.
• 6 September 2019, ESMA published the responses to its call for evidence on potential short-term pressures on corporations stemming from the financial sector, as part of ESMA’s work on sustainable finance.
• 6 September 2019, ESMA published the advice requested to the SMSG on the survey on undue short-term pressure on corporations from the financial sector conducted in June 2019.
• 6 December 2019, the EBA published its Action plan on sustainable finance outlining its approach and timeline for delivering mandates related to environmental, social and governance (ESG) factors.
• 18 December 2019, the ESMA published its findings on potential undue short-term pressures in securities markets.

Level 3

• 18 October 2019, the Commission launched the International Platform on Sustainable Finance (IPSF) together with relevant authorities from Argentina, Canada, Chile, China, India, Kenya, and Morocco, and published a Q&A on the initiative.

Next steps

• The Commission will publish level 2 measures on sustainability risks and factors on MIFID, AIFMD and UCITS early 2020.
• The first level 2 Taxonomy measures are expected for end 2020.
• The European Commission is expected to publish a consultation on a renewed sustainable finance strategy in Q2 2020.
• The renewed sustainable finance strategy is expected for Q3 2020.

State of play: on 9 December 2019, the Regulation was published in the Official Journal (L 317/17).

Level 1

Commission

• 24 May 2018, the proposal was published as part of a reforms package.
• 18 June 2019, the TEG published its report on Climate Benchmarks and Benchmarks’ ESG Disclosures.
• 5 July 2019, the Commission launched a call for feedback on climate benchmarks and benchmarks’ ESG disclosure

Parliament

• 28 September 2018, the ECON Committee published a draft report on the proposal for a regulation.
• 18 October 2018, the ECON Committee held a hearing on the dossier.
• 22 November 2018, the ENVI Committee presented its opinion on the proposals.
• 14 November 2018, the Parliament confirmed the negotiations mandate.
• 13 December 2018, the ECON Committee adopted its report on the proposal and the negotiations mandate.
• 25 March 2019, the Parliament adopted the text of the trilogue agreement in plenary.

Council

• 19 December 2018, the Council adopted its negotiating position on benchmarks and disclosure requirements.
• 8 November 2019, the Council adopted the agreed text on low carbon benchmarks.

Trilogue negotiations

• 25 February 2019, the Parliament and the Council reached an agreement.

Level 3

• 23 March 2019, ESMA published the responses to the consultation on disclosure requirements applicable to credit rating.

State of play: on 9 December 2019, the Regulation was published in the Official Journal (L 317/1).

Level 1

Commission

• 24 May 2018, the proposal was published as part of a reforms package.

Parliament

• 24 May 2018, the proposal was published as part of a reforms package.
• 2 August 2018, the ECON Committee published the draft report on the proposal.
• 17 September 2018, the ECON Committee published amendments on the proposal.
• 11 October 2018, the ENVI Committee presented its opinion on the proposal.
• 5 November 2018, the ECON Committee adopted the report on the proposal.
• 18 April 2019, the Parliament adopted the text of the trilogue agreement in plenary.

Council

• 19 December 2018, the Council adopted its negotiating position.
• 8 November 2019, the Council adopted the agreed text on disclosure obligations.

 Trilogue negotiations

• 14 November 2018, the Parliament confirmed the negotiations mandate.
• 7 March 2019, the Parliament and the Council reached a political agreement.