IOSCO issued a report, prepared by its Sustainable Finance Network ("SFN"), that highlighted current environmental, social and governance ("ESG") initiatives that are supported by securities regulators. The SEC is the United States member on the SFN.
In the report, "Sustainable Finance and the Role of Securities Regulators and IOSCO," the SFN identified how regulators support varying forms of sustainable finance. The SFN stated that regulators (i) provide transparency regarding sustainable investments, (ii) prevent greenwashing, (iii) define ESG-related risks as "financial risks that need to be managed and disclosed," (iv) encourage Corporate Social Responsibility ("CSR") within financial companies and (iv) redirect capital toward "sustainable investments."
In addition, the SFN recommended certain actions to improve the comparability of disclosures relating to sustainability. Based on input from regulators and market participants, the SFN urged IOSCO to facilitate global coordination and increase transparency in order to address the lack of comparability among third-party frameworks.
The IOSCO Growth and Emerging Market Committee provided recommendations to market participants and member jurisdictions on "sustainable finance" in emerging markets and Environmental, Social and Governance specific risks.