The Austrian Financial Market Authority (FMA) has today launched the consultation process for it “Guide for Handling Sustainability Risks” (“Leitfaden zum Umgang mit Nachhaltigkeitsrisiken”). The FMA is using this supervisory instrument to support financial market participants in regulatory terms when managing about the relevant risks. Entities supervised by the FMA are already required to also observe environmental, social and governance risks as part of the general legal regulations on risk management. By actively managing the ESG risks (“environment”, “social”, “governance”) the financial market should make a decisive contribution when moving towards a sustainable financial model. All interested parties are invited to comment on the draft version of the guide in this fully transparent consultation process.
“Sustainability risks, and especially climate change pose challenges to financial market participants. Our Guide is on the one hand intended to make a contribution towards increasing awareness, and to address these risks in an appropriate manner,” remarked the FMA Executive Directors, Helmut Ettl and Eduard Müller: “Since challenges exist for all financial market participants, the Guide has been structured in a manner that over-arches industries and products alike, in keeping with the integrated approach to supervision.”
Detailed and practically oriented
In order in this way to establish a common understanding between the FMA and the supervised entities and to ensure a level playing field, the Guide serves as a cross-sector source of information for banks, insurance companies, asset managers, Pensionskassen (pension funds) and corporate provision funds. It ensures that sustainability risks are taken into account in the exist risk classifications, the management and governance of entities as well as incorporating established transparency requirements. The Guide also includes two comprehensive annexes which cover good practices and sources of information. Boxes containing examples are used to ensure that the explanations provided are as clear and as practically relevant as possible.
Furthermore, the European legislator furthermore will oblige certain financial market participants under the new regulation on disclosure[1] in the future to disclose information (by and large in relation to the transparency obligations that apply with effect from 10.03.2021) about the integration of sustainability-related risks at entity level on their website as well as to include a description about the integration of sustainability-related risks and potential effects in pre-contractual information about financial products. The Guide should serve as assistance for entities supervised by the FMA in taking in account sustainability-related risks as part of their business activities, and serve as assistance for them in relation to the handing of sustainability risks, in particular climate-related risks, in risk management, while furthermore also preparing them for future regulatory developments (including the application of the Disclosure Regulation).
The draft version of the FMA Guide for the consultation is available (in German only) on the FMA website, with interested parties invited to submit their written comments directly to the FMA.
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43 / (0)1 / 24959 – 6006
+43 / (0)676 / 88 249 516
[1] Regulation (EU) 2019/2088 of the European Parliament and of the Council on sustainability‐related disclosures in the financial services sector (“the Disclosure Regulation”)