EIOPA seeks feedback on its proposed approach to tackle greenwashing in the insurance and occupational pension sectors

EIOPA consults on its draft Opinion on sustainability claims and greenwashing, outlining four principles to guide providers in making accurate and substantiated sustainability claims. EIOPA is taking steps to combat greenwashing in the insurance and pensions sectors. With the increasing demand for sustainable investments, providers have expanded their offerings, leading to a rise in potential instances of misleading sustainability claims, known as greenwashing.
1. The first principle emphasizes that sustainability claims should align with the provider’s overall profile and business model or the profile of its products. This ensures accuracy, precision, and consistency in portraying the sustainability aspects of offerings.
2. The second principle highlights the importance of keeping sustainability claims up to date and disclosing any changes in a timely manner with a clear rationale. This addresses the dynamic nature of sustainability practices and prevents outdated or misleading claims.
3. The third principle emphasizes the need for sustainability claims to be substantiated with clear reasoning and facts, promoting transparency and accountability.
4. The fourth principle underscores the accessibility of sustainability claims and their substantiation to targeted stakeholders, enhancing transparency and consumer awareness.
EIOPA proposes that NCAs monitor providers‘ adherence to these principles, evaluate sustainability claims, and ensure compliance with regulatory requirements. The authority acknowledges the challenges in supervising greenwashing, including the complexity of the regulatory framework, the need for expertise, and the lack of a common EU-level approach.
Stakeholders are invited to provide feedback on the proposed principles through an online survey, with the deadline for submission set for 12 March 2024. EIOPA’s initiative aligns with the growing awareness of sustainability issues in the financial sector, aiming to maintain trust among consumers and pension savers while promoting accurate and transparent sustainability practices. This effort complements the broader trend of integrating sustainability considerations into financial regulations and practices across the EU.