The European Banking Authority (EBA) has published a consultation paper on draft implementing technical standards (ITS) on Pillar 3 disclosures on Environmental, Social and Governance (ESG) risks.
The draft ITS focuses on disclosures that show how climate change may increase other risks within institutions’ balance sheets, how they are mitigating those risks, and their green asset ratio on exposures financing taxonomy-aligned activities, such as those consistent with the Paris agreement goals.
The draft ITS provides a framework for ESG disclosures to make sure that stakeholders are aware of the possible ESG exposures and strategies and can make informed decisions about it. Being informed about the ESG risks is a vital so that stakeholders can assess the banks’ ESG related risks and sustainable finance strategy.
The EBA has developed the Consultation paper in parallel and consistently with its advice to the EU Commission on ESG disclosures under the EU taxonomy, including a proposal for a Green Asset ratio (GAR).
Download the consultation paper via the button below.