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The EU’s supervisory authorities have launched a joint call for evidence on greenwashing and how best to tackle it. This includes wanting to hear from payment institutions.
How to understand the key features, drivers and risks associated with greenwashing and examples of its practices are part of the European Banking Authority, European Securities and Markets Authority, and European Insurance and Occupational Pensions Authority’s new consultation.
Collectively known as the ESAs, the regulators added that due to the growing demand for sustainability-related products, and the rapidly evolving regulatory regimes and sustainability-related product offerings, the new consultation is also motivated by the need to better understand which areas may become more prone to greenwashing risks.
“Obtaining a more granular understanding of greenwashing will help inform policy making and supervision, and will help foster the reliability of sustainability-related claims,” the ESAs said in a joint statement.
“In the context of this call, the term 'greenwashing' is broadly used, recognising that sustainability-related claims can be linked to all aspects of the ESG spectrum.”
All interested parties are welcome to contribute to the survey, including financial institutions under the remit of the three ESAs as well as other stakeholders, ranging from retail investors and consumers’ associations, NGOs and academia.
This also includes both payment service providers and electronic money institutions, which are regulated via the EBA.
Questions include asking stakeholders to specify which sector they hail from, which sector they witnessed greenwashing in, and whether they felt it was intentional or not.
Contributors have been advised to focus on greenwashing risks and occurrences arising in the financial sector and affecting financial products or services that are in scope of the ESAs.
Stakeholders have also been asked to consider communication channels where greenwashing has been committed by market participants.
For example, this could include a variety of channels such as regulatory reports and social media marketing campaigns.
Respondents are invited to submit their responses by January 10, 2023.
Contributions will feed into the ESAs’ findings for their progress reports due in May 2023, and final reports due in May 2024.
The call for evidence has been prompted by a May 2022 request from the European Commission to investigate greenwashing risks and sustainable finance policies.
