ESG: IOSCO Publishes Report on Sustainable Finance and the Role of Securities Regulators and IOSCO
On April 14, the International Organization of Securities Commissions (IOSCO) published a final report on sustainable finance and the role of securities regulators and IOSCO (the Report).
In the Report, IOSCO provides an overview of the current sustainable finance initiatives taken by regulators and the industry. The Report also includes a detailed analysis of the most relevant environmental, social and governance related international initiatives, and third-party frameworks and standards.
IOSCO identified in the Report a number of areas where improvements could be made, including:
multiple and diverse sustainability frameworks and standards, in particular, sustainability-related disclosure;
a lack of common definitions of sustainable activities, for example, there is not a clear definition of sustainable investments and sustainability risk; and
greenwashing and other investor protection challenges.
The Report notes that market regulators and participants expect IOSCO to take an active role in addressing the above listed challenges. Consequently, IOSCO has agreed to establish a board level Sustainability Task Force (STF). The STF aims to:
improve sustainability-related disclosures made by issuers and asset managers;
work in collaboration with other international organizations and regulators; and
conduct case studies and analyses of transparency, investor protection and other relevant issues within sustainable finance.
The Report is available here.