Scientific Beta

Benefits and Pensions Monitor:"Proposals from the Technical Expert Group (TEG), which the European Commission mandated to assist it in drawing up delegated acts implementing the Regulation on Climate Benchmarks and Sustainability Disclosures of Benchmarks (2019/2089), go against the legislator’s goal of an ambitious reorientation of investment flows in support of climate transition and sustainability, says Scientific Beta."

Benefits and Pensions Monitor 28/02/2020

"(...) Proposals from the Technical Expert Group (TEG), which the European Commission mandated to assist it in drawing up delegated acts implementing the Regulation on Climate Benchmarks and Sustainability Disclosures of Benchmarks (2019/2089), go against the legislator’s goal of an ambitious reorientation of investment flows in support of climate transition and sustainability, says Scientific Beta. Where the regulation was calling for explanations of how ESG dimensions are incorporated into sustainable benchmarks, the TEG champions the imposition of extensive and expensive ESG disclosures. These onerous reporting requirements would discourage the offering and adoption of benchmarks that pursue climate change or other ESG objectives. In addition, the proposed disclosures would fail to promote informed decision-making in terms of sustainability. This is both because they centre on ESG ratings whose inherent divergence frustrates the possibility of meaningful comparisons and because the TEG fails to standardize disclosures in respect of ESG metrics that could have relevance. (...)"