The European Supervisory Authorities have published final Joint Guidelines on the integration of Environmental, Social and Governance (ESG) risks into supervisory stress testing.
Applicable from 1 January 2027, the Guidelines aim to promote consistency and proportionality across EU supervisory practices.
While formally addressed to competent authorities, the Guidelines have clear practical implications for banks, insurers and investment firms, particularly in relation to ESG risk identification, materiality assessments, stress testing methodologies and data governance.