Overview of supervisory requirements


The topic sustainability is also on the agenda of the supervisory authorities.

With the UN agenda 2030, the Paris climate treaty, the EU action plan and the leaflet of BaFin on how to deal with sustainability risks, there are plenty of regulatory changes ahead.

You will find the most important publications on sustainability here.

Michael Dietrich
Senior Consultant
+49 160 8861560

Patricia Georgi
Managing Director
+49 175 1985444


Commission                  Parliament                     Council

EU commission: The executive represents as a central task the general interests of the EU. Thanks to its right of initiative it can make suggestions for new European regulations. It furthermore implements EU strategies politically and represents the EU on a national level.

EU parliament: As the legislative branch of the European Union and one of its seven institutions. Furthermore, it decides together with the EU council (representatives of the EU member states) on the EU household and the legislation. Furthermore the Parliament controls the European commission as well as other organs and institutions of the EU.

EU council: As the voice of the governments of the EU member states that the council accepts laws and coordinates EU policies.

EU action plan

On March 8th, 2018 the EU commission published an EU action plan for the financing of sustainable growth. The action plan contains 10 points that serve the achievement of the UN agenda 2030 and the Paris climate treaty.


On June 18th, 2020, the European Parliament and the European Council published the taxonomy regulation in the office journal of the European Union. The taxonomy regulation is the first step of the EU action plan and demands the creation of an EU-wide classification system for sustainable activities.

Guidelines for the reporting of non-financial information: Amendment for the climate-related reporting

On June 20th, 2019 the EU commission published a 30 page guideline for the climate-related reporting in the office journal of the European Union. As a relevant guideline serve the recommendations of the Task Force on climate-related Financial Disclosures (TCFD).


Federal institution for financial service spervision

The main concern of BaFin is to guarantee a stable and trustworthy financial system in Germany. The BaFin works as financial supervision by supervising and controlling German financial markets, in order to make fair trade conditions possible.

BaFin official journal for the dealing with sustainability risks

On December 20th, 2019 the BaFin published an official journal for the dealing with sustainability risks. Thereby BaFin wants to give banks and financial service providers an orientation and at the same time to implement the recommendations of 1 b) the Network for Greening the Financial System (NGFS), to include climate-related risks in the supervision and to formulate supervisory expectations. The principles and processes included in the official journal have to be seen as a sensible and binding procedure (good practice approaches) that companies can find orientation by under consideration of sustainability risks.

Supervisors focusses 2020

On May 13th, 2020 the BaFin published a brochure to inform the respective financial institutions about the current focusses of the supervision that BaFin has fixed in its strategic planning.


Confederacy financial supervision

The FINMA is an independent authority that supervises the Swiss financial market. It has the task to guarantee the protection for creditors, investors and insured persons as well as the functionality of the financial markets. In order to guarantee this the FINMA has power over all players at the financial markets such as banks and insurance companies. Furthermore, even stock markets, collective investments and insurance intermediaries are subject to the supervision of FINMA.

FINMA deals with climate-related financial risks

The FINMA has been a member of the Network for Greening the Financial System (NGFS) since 2019. The NGFS consists of international central banks and supervision authorities and supports the consideration of environmental and climate risks in the financial sector. Furthermore, FINMA supports the analyses of the working group Sustainable Finance, that is lead by the state secretary for international financial matters (SIF) with its technical expertise.


European securities and market supervision authority

The task of the ESMA is to improve investor protection and to provide stable, regulated and functioning financial markets.

No Action-Letter

The new regulations came into effect on April 30th, 2020. It requires that the administrators of benchmarks state in their methodology documents and benchmark declarations how the ESG factors are reflected.

Joint Consultation Paper - ESG disclosures

On April 23rd, 2020 the three supervisory authorities ESMA, EBA and EIOPA (ESAs) published a consultation document in which they ask for feedbacks to the suggested environmental, social and governance disclosure standards for financial market participants, consultants and products.


European bank supervisory authority

As a central task the European bank supervisory authority is supposed to guarantee a consistent regulation and supervisory framework for the entire EU banking sector.

Guidelines on loan origination and monitoring

The EBA guidelines determine the internal governance rules for the guarantee and monitoring of credit facilities during their entire lifecycle. With the EBA guidelines the requirements for the credit standing check of borrowers are combines with the goals for supervisory requirements and customer protection.

Joint Consultation Paper - ESG disclosures

On April 23rd, 2020 the three supervisory authorities ESMA, EBA and EIOPA (ESAs) published a consultation document in which they ask for feedbacks to the suggested environmental, social and governance disclosure standards for financial market participants, consultants and products.

The consultation paper of EBA for the integration and management of ESG risks in credit institutes and investment firms

On November 3rd, 2020, the European Banking Authority (EBA) published a consultation paper for the supervisory and regulatory involvement of environmental, social and governance risks (ESG risks) into the internal business processes and into the risk management of credit and investment institutes.


Basel committee for banking supervision

The Basel committe for Banking supervision (BCBS) is a global standard setter for the supervisory regulations of banks and offers a forum for the regular cooperation with banking supervisory questions.

Task Force on Climate-related Financial Risks (TFCR)

The TCFR of the BCBS has the task to contribute that the global financial stability improves by undertaking certain initiatives in respect to climate-related financial risks.


Financial Stability Board

The Financial Stability Board is an international committee that coordinates and supports the works to supervise and regulate the international financial markets. FSB members are the central banks, supervision authorities and financial ministries of the G20 countries as well as the special administration region Hong Kong, the Netherlands, Switzerland, Singapore and Spain.

Task Force on Climate-related Financial Disclosures (TCFD)

On June 29th, 2017 the TCFD published a voluntary, consistent disclosure of climate-related financial risks that is supposed to be used by companies for the supply of information for investors, creditors, insurers and other interest groups. Furthermore, the recommendations were used as relevant guidelines in the notification of the EU commission for the guidelines for reporting on non-financial information: amendment for climated-related reports.