UKSIF response: ESG Data and Ratings Working Group (DRWG) consultation on Draft Voluntary Code of Conduct

Since the formation of the ESG Data and Ratings Code of Conduct Working Group (DRWG) in November last year, the UK Sustainable Investment and Finance Association (UKSIF) alongside many of our members, from both our investor and service provider networks, have been strongly supportive of the group’s core objectives in developing an industry-wide code to enhance transparency and trust of the ESG data and ratings market in the UK.

It is encouraging to see the swift progress achieved already by the working group in recent months, and we look forward to seeing this momentum maintained and the final Code published before the end of this year. We remain optimistic that the Code of Conduct can help build greater trust in ESG data and ratings products in the UK, protect market integrity, promote more effective competition among providers, and importantly achieve this at pace while HM Treasury considers further its approach to a formal regulatory regime for ESG ratings.

In our response, we highlight our strong support for the draft Code’s objectives, main principles, and provisions, while drawing attention to a number of specific considerations for further exploration by the IRSG, ICMA, and FCA ahead of the finalised Code later this year. These considerations include the following: the importance of appropriate sequencing of the UK’s Code of Conduct with HM Treasury’s approach to regulation, interoperability of the UK’s Code with global voluntary codes and regulatory regimes, including in the European Union, promoting a level playing field between larger and smaller providers, and oversight of the Code which we believe should be supervised by the FCA in future.

UKSIF’s response is informed by our membership, though this does not necessarily reflect the views and perspectives of our entire membership, either individually or collectively. 

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