In June, the technical expert group (TEG) on sustainable finance will publish three new reports:
- a report on the EU taxonomy;
- a report on the EU Green Bond Standard;
- and an interim report on Climate benchmarks and benchmarks’ ESG disclosures.
To accompany these reports and provide a venue for an open exchange with stakeholders, the Commission will organise a Stakeholder dialogue on sustainable finance on 24 June 2019. The reports are expected to be published published in the week before the event.
In addition to the reports of the TEG, during the event the Commission will publicly launch new guidelines for companies on how to report climate-related information. These guidelines are built on the proposals made by the TEG in January 2019.
The event will also feature a session on exchanging views on the future of sustainable finance, where the audience will be invited to present their ideas.
What is the TEG, where does it stand, and what will happen after June?
To advance the work on sustainable finance, the European Commission set up the TEG in June 2018. The role of the TEG has been to assist the Commission in the development of a unified classification system for sustainable economic activities (“EU Taxonomy”), an EU green bond standard, methodologies for low-carbon benchmarks, and metrics for climate-related disclosure.
The TEG has been working on developing the EU taxonomy for climate change mitigation and climate change adaptation. In December, the TEG published a first round of climate change mitigation activities and their technical screening criteria, together with a call for feedback on the proposed criteria. The TEG has also engaged with over 150 additional experts in the past few months to develop technical screening criteria for the second round climate change mitigation activities and adaptation activities.
The TEG will organise a call for feedback over the summer on its final report and will advise the Commission on how to take the feedback forward.
Subject to the outcome of the negotiations between the Council of the EU and the European Parliament on the legislative proposal on taxonomy, the Commission has committed to consult the public on any measures it will propose under this framework.
Once the Taxonomy Regulation has been agreed between the Council of the EU and the European Parliament, the Commission is expected to develop delegated acts building on the TEG report. The Commission will conduct a formal consultation on these delegated acts.
EU Green Bond Standard
The TEG has been working on recommendations for the development of an EU Green Bond Standard, with a view to increasing transparency and comparability of the green bond market, as well as to provide clarity to issuers on the steps to follow for an issuance, in order to scale up sustainable finance.
In June the TEG will publish an updated, final report, to reflect both the feedback received from stakeholders and the latest analyses conducted by the Group. No additional call for feedback is foreseen for the June report.
After June, the TEG will further work on its proposal for the accreditation of external verifiers, as well as monitor the latest developments in parallel on-going initiatives, both at EU level (taxonomy, prospectus regulation, EU ecolabel) and internationally (ISO work), so as to advise on consistency with the proposed EU Green Bond Standard.
Climate benchmarks and benchmarks’ ESG disclosures
The TEG has been working on defining minimum standards for the methodologies of the ‘EU Climate Transition’ and ‘EU Paris-aligned’ benchmarks, addressing the risk of greenwashing. It has also worked on disclosure requirements in relation to Environmental, Social and Governance (ESG) factors and the alignment with the Paris agreement, including the standard format to be used to report such elements.
The TEG has engaged extensively with experts in the field in the past few months organising several workshops in order to obtain expertise and input.
The June interim-report will be accompanied by a call for feedback to run until the end of July. Taking into account the feedback received the TEG is expected to publish the final version of the report by the end of September.
Following the publication, the Commission will develop a delegated act building on the TEG report. The Commission will conduct a formal consultation on this delegated act.
The TEG work on climate-related disclosures had a slightly different time line than the other three tasks. As the Commission will update the non-binding guidelines that accompany the non-financial reporting directive by the end of June, the TEG already published its final report on climate-related disclosures in January 2019. The report contained recommendations for how companies should disclose climate-related information, thereby advising the Commission on which elements should be part of an update of the non-binding guidelines.
The Commission used the TEG report and the related stakeholder feedback, when developing the new climate reporting guidelines that will be publicly launched on 24 June. The new guidelines on reporting climate-related information will be a supplement to the existing non-binding guidelines on non-financial reporting published by the Commission in 2017. They are consistent with the requirements of the Non-Financial Reporting Directive, and they also integrate the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). They provide guidance for companies on how to report on the impacts of their business on the climate and on the impacts of climate change on their business.
Register your interest
Registration of interest closed on 7 June 2019.
As the seats for this event are limited, the Commission staff will review the expressions of interest in order to ensure a balanced audience. Please wait for an explicit confirmation that your attendance has been approved before proceeding with travel arrangements.