FCA proposes new changes to ESG ratings

The UK financial services regulator, the Financial Conduct Authority (FCA), has announced proposals to ensure a new level for ESG ratings.

The newly publicised standards are designed to make ESG ratings transparent, reliable, and comparable, a move expected to deliver around £500 million in net benefits over the next decade.

ESG ratings inform investment decisions, risk management and regulatory reporting and are now a large operational matter for many insurers. According to the FCA’s press release, global spending on ESG data, including ratings, is projected to reach $2.2 billion in 2025.

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