You are on the Green & Sustainable Hub website
You are on the Green & Sustainable Hub website, part of Natixis CIB.

Greenwashing as a cornerstone of ESMA’s newly released Sustainable Finance Roadmap

2 - minute read


On February 10th, 2022, the European Securities and Markets Authority (ESMA) released its Sustainable Finance Roadmap for the period 2022-2024[1]. This blueprint aims at coordinating the implementation of the supervisor’s broadening sustainable finance mandate. The document is built upon three main priorities:  


Table 1 - Main priorities


Tackling greenwashing and promoting transparency

Building National competent authorities’ and ESMA’s sustainable finance capacities

Monitoring, assessing and analyzing ESG-related markets and risks




  • Contribute to European Commission’s (EC) efforts to develop EU-wide labels;
  • Cooperate with EC, EFRAG and IASB on delivering an assessment of whether IFRS appropriately integrate sustainability risks.
  • Map NCAs’ supervisory role taking into account sustainable finance requirements related to investment services;
  • Organize discussion among NCAs of new climate benchmarks and how to effectively supervise them.
  • Undertake work on climate change scenario analysis;
  • Assess data availability and quality for asset managers.

Source: Sustainable Finance Roadmap, ESMA


Among these priority areas, the ESMA puts the emphasis on the greenwashing which is at the core of its Roadmap. The development of a common understanding of the issue is insightful.

For the ESMA, greenwashingintuitively refers to market practices, both intentional and unintentional, whereby the publicly disclosed sustainability profile of an issuer and the characteristics and/or objectives of a financial instrument or a financial product either by action or omission do not properly reflect the underlying sustainability risks and impacts associated to that issuer, financial instrument or financial product”.


The roadmap details an ambitious list of 71 actions and deliverables that will be undertaken by the ESMA between 2022 and 2024. Several actions are cross-sectoral (e.g., assess greenwashing practices, undertake horizontal mapping of ESG data needs/usages, implement the Sustainable Finance Training Plan) and others are specific to sub-industries namely investment management, investment services, issuers’ disclosure & governance, benchmarks, trading and financial innovation, ratings. With regards to ESG data, this echoes to the Call for evidence[2] on Market Characteristics for ESG Rating Providers in the EU, also launched by the ESMA on February 3rd, 2022. 

In particular, the ESMA plans to support the development of EU-wide labels, such as EU Green Bond Standard (EU GBS) and other upcoming ESG labels for instruments and investments products. ESMA’s ambitions to build NCAs’ and ESMA’s capacities as well as to build a common European supervisory culture around sustainable finance are worth to mention.

One distinguishes areas of actions that are in the direct or even exclusive remit of the ESMA from others to which it will only contribute. All the actions planned contribute to ESMA’s direct prerogatives: single rulebook, risk assessment, supervisory convergence & direct supervision.

The European watchdog intends to assess or contribute to a large part of current and future regulations:


Table 2 - Current and future regulations

European legislative texts

International regulations and organizations

  • Corporate Sustainability Reporting Directive;
  • Sustainable Finance Disclosure Regulation;
  • Taxonomy Regulation;
  • Undertakings for Collective Investment in Transferable Securities Directive;
  • Alternative Investment Fund Managers;
  • Market in Financial Instruments Directive II;
  • EU GBS, Benchmark Regulation.
  • International Financial Reporting Standards;
  • International Organization of Securities Commissions;
  • Network for Greening the Financial System.

Source: Sustainable Finance Roadmap, ESMA

The Roadmap is holistic, consistent, and granular in terms of both priorities and actions identified. In coherence with the fast-evolving nature of sustainable finance, this document is presented as living and meant to be regularly updated. Timelines for each action are therefore indicative and subject to potential future evolutions.


[1] ESMA, Sustainabe Finance Roadmap, February 10th 2022, available here.

[2] ESMA, Call for evidence on Market Characteristics for ESG Rating Providers in the EU, February 3rd 2022, available here.