EBA consults on revision to POG guidelines for ESG retail banking products

The European Banking Authority (EBA) has published a consultation paper on proposed revisions to its product oversight and governance (POG) guidelines for retail banking products. The EBA considers the update necessary in light of its June 2024 greenwashing report, which identified growing risks across the financial sector and to align with recent legislative amendments to the Capital Requirements Directive (CRD) and Capital Requirements Regulation (CRR) concerning Environmental Social Governance (ESG) risk management.

The revised guidelines aim to strengthen safeguards against greenwashing and ensure that financial institutions maintain high standards of conduct when offering products with ESG features. The EBA proposes a proportionate and targeted approach, adjusting a limited set of existing requirements related to the product's subject matter, manufacturers internal controls, the target market, distribution channels and information flows for the manufacturer's arrangements. A small number of consequential updates are also proposed. The deadline for comments on the consultation is 9 October, with the final guidelines expected to be published in Q1 2026 and effective from 1 December 2026. A virtual public hearing is scheduled for 11 September.

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