The European Banking Authority (EBA) has issued a “no-action” letter urging regulators not to prioritize enforcement of certain ESG-related Pillar 3 disclosure templates for banks. This pause comes as the EU progresses on its Omnibus legislative package, which aims to simplify sustainability reporting rules, especially key directives like the CSRD, Taxonomy Regulation, and more.

This guidance specifically advises against the strict enforcement of templates EU 6–10 and select columns in Templates 1 and 4, as defined under the Commission’s Implementing Regulation (EU) 2024/3172 and the EBA’s own Decision EBA/DC/498. The recommendation applies to both large, listed financial institutions and those recently brought under the enhanced scope of ESG disclosures by the CRR3 framework, effective January 2025.

The timing of this directive acknowledges that rushing enforcement amid shifting ESG rules could lock institutions into obligations that may soon change and potentially create confusion or uneven application. For smaller banks, abrupt enforcement could impose disproportionate burdens amid regulatory flux.

EBA emphasized its dedication to a “coherent and streamlined ESG disclosure framework,” promising close collaboration with EU institutions and stakeholders to support smooth implementation of future requirements.

Besides the no-action letter, the EBA released an updated ESG risk dashboard, based on December 2024 data. The findings suggest a stable risk environment across EU/EEA banks, emphasizing the slow-moving, long-term nature of evolving climate and ESG risks. Future dashboards will be adjusted to reflect the pause in enforcement and evolving disclosures.

In conclusion, this move represents a strategic pause, not a step back, allowing banks and supervisors time to adapt to forthcoming regulatory changes. Institutions should remain vigilant and prepare for eventual updates, without being compelled to comply immediately with templates that may soon be revised.

Source:

https://www.esgtoday.com/eba-instructs-regulators-to-hold-off-on-enforcement-of-esg-disclosure-requirements-for-banks/