GlobalData surveying reveals that companies are embracing ESG performance plans due to regulatory and financial pressures. The FCA proposes new measures to enhance transparency and reliability of ESG ratings, addressing concerns about inconsistent methodologies. Legislation is the main driver for ESG adoption, shaping corporate behavior and promoting credible ESG metrics.

The FCA’s proposals aim to make ESG ratings more transparent and comparable, supported by 95% of consultation respondents. The focus is on improving rating transparency, governance, and oversight to address concerns about inconsistent methodologies and limited transparency. Clear regulatory expectations will help companies assess and communicate ESG performance more credibly.

As regulatory pressure and stakeholder expectations for ESG performance rise, companies must align with the FCA’s standards to enhance compliance and communication. Transparent and well-governed ESG plans are becoming essential in the financial sector to benchmark progress, identify risks, and engage responsibly with investors and customers. ESG frameworks must evolve to meet changing expectations.

Read more at Yahoo Finance: FCA moves to standardise ESG ratings as regulation drives ESG plans