The European Supervisory Authorities, including the European Securities and Markets Authority, have launched a public consultation on draft Joint Guidelines on environmental, social and governance (ESG) stress testing mandated by the Capital Requirements Directive and the Solvency II Directive. The proposals set out how competent authorities in the banking and insurance sectors should integrate ESG risks into supervisory stress tests, aiming to harmonise approaches across the EU while ensuring proportionality. The draft Guidelines establish a common framework for developing ESG-related stress testing methodologies and standards, covering the design and features of stress tests with ESG elements and the organisational and governance arrangements needed to support them. Expectations include sufficient human resources with relevant expertise, data collection and management systems that enable access to high-quality ESG data, and appropriate timelines for scenario analysis, with the framework intended to accommodate future methodological and data improvements. Feedback is requested via an online survey by 19 September 2025, and an online public hearing is scheduled for 26 August 2025 from 10:00 to 12:00 CEST. Responses will be published on the ESAs’ websites unless respondents request otherwise.
European Securities and Markets Authority 2025-06-27
European Securities and Markets Authority and other ESAs launch consultation on Joint Guidelines for ESG supervisory stress testing
The European Supervisory Authorities, including the European Securities and Markets Authority, have initiated a public consultation on draft Joint Guidelines for ESG stress testing as mandated by the Capital Requirements Directive and Solvency II Directive. The guidelines aim to harmonize ESG risk integration in supervisory stress tests across the EU, detailing methodologies, standards, and governance arrangements. The framework emphasizes proportionality and supports future methodological and data enhancements.