European Banking Authority proposes simpler rules for ESG reporting at smaller banks

The European Banking Authority (EBA) has proposed a major update to its ESG reporting supervisory framework, with the aim of simplifying reporting requirements, making them more proportionate and easier for banks to manage, while still preserving the information needed by supervisors. The proposed changes are part of a broader simplification package by the EBA, focused on reducing the administrative burden of reporting across the banking system. The importance of the proposal lies in its timing. ESG supervisory reporting is still relatively recent under EU banking regulations, and banks have been preparing for broader sustainability-related reporting obligations since the CRR3 package of banking measures extended ESG risk disclosure beyond larger institutions. The EBA now seeks to ensure that the supervisory framework does not become unnecessarily complex, especially for smaller and less complex banks.

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