Sustainability supervision: clarity, not confusion
The European Securities and Markets Authority (ESMA) has released a public statement addressing the patchy rollout of sustainability supervision under the European Sustainability Reporting Standards (ESRS).
As the first wave of large public-interest entities publish sustainability statements, ESMA has acknowledged “uncertainty” due to uneven transposition of the Corporate Sustainability Reporting Directive (CSRD), legislative changes looming with the ongoing Omnibus proposals, and varying supervisory approaches across Member States.
While ESMA reaffirms its commitment to transparency and mitigating greenwashing, it also noted that it intends to use a “flexible, proportionate” approach during this transitional phase. The Guidelines for Enforcement of Sustainability Information (GLESI) offer latitude for national competent authorities (NCAs), recognising the legal and resource constraints some face.
Regardless of the complexity of the landscape what’s needed is a consistent, enforcement framework. Fragmented or delayed enforcement risks undermining data quality, investor trust, and comparability across markets. Disclosure needs feedback loops from regulators and markets to operate effectively.
Getting the rules sorted, standardised, and applied swiftly is essential. Have we ever mentioned that in our view delaying comprehensive digital implementation (and effective enforcement) impacts the utility and relevance of these disclosures?
Read ESMA’s statement here.
