UKSIF CEO James Alexander has spoken to Prime Minister Rishi Sunak at Policy Exchange about the steps needed to establish the UK as the world’s leading green finance centre, and as part of the reform need to achieve this UKSIF has given its support to a future regulatory regime for ESG ratings providers.

HM Treasury’s and FCA’s initiatives exploring new regulatory measures for ESG ratings providers, is seen as absolutely crucial for investors and other users to have full confidence in these ESG ratings, including their underlying methodologies.

The diverse, and at times contradictory methodology and results have long since been an impediment to progress, and greater transparency and high-quality standards are required, which would bring considerable benefits for both ESG ratings providers and users.

In Treasury’s upcoming work, UKSIF sees transparency as a core priority, alongside those areas outlined in the International Organization of Securities Commissions (IOSCO) recommendations paper published in November 2021. This includes effectively addressing conflicts of interest and promoting good governance.

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