With the ESG Rating Provider Regulation, the EU is the first jurisdiction in the world to move to regulate the nascent ESG rating market. The aim of the regulation is to facilitate progress towards achieving the net-zero objectives by 2050, while leveraging private finance into activities in line with the objectives of the Green Deal.

In this briefing, we summarize the most important aspects of the Draft Proposal, including background, relevance, scope, authorisation, third-country regimes, transition rules, key requirements for ESG rating providers, supervision by ESMA, rights of (investors of) rated items and stakeholders, and ESG in credit ratings.