The European Banking Authority (EBA) recently released guidelines on the management of environmental, social, and governance (ESG) risks, marking a key step in banking supervision.

These guidelines on ESG risk plans for banks call for the development of a single, comprehensive strategy that aligns all relevant regulatory demands[1] for both prudential and corporate transition plans.

WWF EU, in response to prior EBA consultations, successfully advocated for a single transition plan for improved consistency and clarity, as well as the integration of nature risks.

Chiara Pass, Sustainable Finance Policy Officer at WWF EU, says:
"The final Guidelines on ESG risks from the European Banking Authority provide a much needed clarification that banks ‘will need to develop a single, comprehensive strategic planning process that covers all regulatory requirements’. This can ensure consistency and simplicity, and drive synergies. In addition, EBA added a useful concrete tool for banks to develop their ESG risk plan, and nature is better integrated in the proposal.”

[1]: Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence Directive (CSDDD), Prudential Rules as outlined in the Capital Requirements Regulation (CRR) & Capital Requirements Directive (CRD).

The European Banking Authority's guidelines on the management of ESG risks mark a key step in banking supervision.

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New EBA guidelines: A milestone for ESG risk management

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