ISDA Responds to ESAs Call for Evidence on Greenwashing

On January 10, ISDA submitted its response to the European Supervisory Authorities’ (ESAs) call for evidence on greenwashing. The response highlights that the current regulatory framework provides for an inconsistent treatment of derivatives and an unclear representation of the role of derivatives in sustainability, exposing them to unwarranted claims of greenwashing. It reiterates its call for specific environmental, social and governance (ESG) classification guidelines to be issued for derivatives in order to allow financial institutions to implement their ESG obligations without undue regulatory risks, which could otherwise expose firms selling these products to a significant risk of litigation and reputational damage. ISDA further points to the lack of clarity around regulations and methodologies as one major cause of greenwashing. It also elaborates on the structure of sustainability-linked derivatives (SLDs) and ISDA’s related work to encourage adequate disclosure of how SLDs help attain sustainability objectives, therefore supporting the integrity of this developing market.

Documents (1) for ISDA Responds to ESAs Call for Evidence on Greenwashing

FRTB Impact on Correlation Trading

The capitalization of the correlation trading portfolio (CTP) under the Fundamental Review of the Trading Book will have an adverse economic impact for users of these instruments. In particular, there is a lack of clarity and consistency in the application...

A Path to Greater CFTC-SEC Alignment

Earlier this week, the Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC) held a roundtable on regulatory harmonization – an initiative we wholeheartedly support. The US regulatory framework has evolved over time to facilitate financial markets...