The European Supervisory Authorities (ESAs), including the EBA, EIOPA, and ESMA, have published final reports on greenwashing in the financial sector. Greenwashing refers to misleading sustainability-related statements that do not accurately reflect the true sustainability profile of an entity or product. The ESAs emphasize the need for clear, fair, and non-misleading sustainability information.
The EBA report highlights an increase in greenwashing allegations, with EU banks seeing a 26.1% rise in 2023. The report identifies reputational and operational risks as significant concerns and underscores the importance of accurate sustainability claims to maintain market trust.
The ESAs call for enhanced supervision and the implementation of robust regulations to address greenwashing. They recommend measures at both entity and product levels to ensure transparency and accuracy in sustainability claims.
Hands on Guide - https://www.sth-consulting.eu/blog/hands-on-guide-for-financial-companies-to-mitigate-greenwashing-risks
9 Key Takeaways from the IFRS 18 Educational Video for Financial Institutions and Insurers.
