June Global Regulatory Brief: Green finance

The Global Regulatory Brief provides monthly insights on the latest risk and regulatory developments. This brief was written by Bloomberg’s Regulatory Affairs Specialists.

The financial sector continues to face new rules and government expectations as part of the broader effort to aid the green transition. The following green finance policy developments represent a sample of wider regulatory and policy coverage available to Bloomberg Terminal customers. Run REGS <GO> to find out more or contact your Bloomberg representative to learn more:

• Australia: ASIC supports firms with climate-related reporting
• Saudi Arabia: CMA approves guidelines for green, social, and sustainability-linked debt instruments
• EU: EBA consults on amended implementing standards to Pillar 3 ESG reporting
• Malaysia: SC proposes mandatory sustainability assurance framework

Australia’s regulator on climate-related reporting

ASIC Commissioner Kate O’Rourke outlined the regulator’s proactive approach to the new mandatory climate-related financial disclosures in Australia.

In more detail: This framework, described as a “once-in-a-generation” change, aims to enhance transparency and address climate risk within the financial system. To assist reporting entities, ASIC is focusing on three key areas:

• Regulatory Guidance: In March 2025, ASIC released Regulatory Guide 280 (RG 280) on sustainability reporting. This guide, refined through public consultation, offers detailed direction on the content required in sustainability reports, including climate-related scenario analysis and Scope 3 emissions. ASIC will continue to review voluntary disclosures and lodged sustainability reports to inform future guidance.
• Regulatory Relief: ASIC is receiving and considering applications for relief from reporting and audit obligations, acknowledging that some issues are novel and specific to entities. The regulator plans to publicize its approach to common themes emerging from these applications to provide market clarity.
• Capacity Building: Recognizing potential concerns, particularly for smaller entities and SMEs in supply chains, ASIC is developing educational materials. These resources will cover fundamental concepts like climate change basics, emissions accounting, and scenario analysis, aiming to equip preparers with the necessary understanding.

Regarding enforcement, ASIC stated it will be pragmatic and proportionate during this transition period. Early enforcement action will likely target serious or reckless misconduct or failure to prepare a sustainability report. However, ASIC also has new powers to direct entities to correct incorrect, incomplete, or misleading statements. In contrast, ASIC maintains a strict stance against greenwashing, enforcing long-standing prohibitions on misleading conduct.

What’s next: Group 1 entities will submit their first climate reports by March 2026, with subsequent groups following in July 2026 and 2027. ASIC will continue to monitor developments, review lodged reports, and provide further guidance as needed to ensure high-quality, consistent, and comparable disclosures, which are crucial for investor confidence and market integrity.

Saudi Arabia approves guidelines for green, social, and sustainability-linked debt instruments

The Saudi Capital Market Authority (CMA) approved new guidelines for issuing green, social, sustainable, and sustainability-linked debt instruments.

Broader context: The guidelines aim to align with Vision 2030, international sustainability standards, and the Kingdom’s environmental goals.

In summary: They define clear frameworks for structuring, disclosing, reviewing, and reporting such debt instruments. Issuers must ensure transparency in proceeds use, performance tracking, and alignment with Sustainable Development Goals (SDGs).

Key guidelines:

• Use of Proceeds: Issuers must clearly define eligible green, social, or sustainability projects and how funds will be allocated, aligned with SDGs.
• Disclosure & Transparency: Issuers must publish frameworks and post-issuance reports (annually) via Tadawul’s website for public offerings.
• External Review: A qualified, independent reviewer must assess compliance with ICMA principles and issue a report before issuance.
• Sustainability-Linked Instruments: Issuers must define KPIs and ambitious sustainability targets, with performance impacting instrument structure/returns.
• Compliance & Explanation: Guidelines are voluntary, but non-compliance must be explicitly disclosed in offering documents.

To note, the guidelines do not include any changes to current regulations or procedures.

EBA consults on amended implementing standards to Pillar 3 ESG reporting

The European Banking Authority (EBA) has launched a public consultation on proposed amendments to the European Commission’s Implementing Regulation on Pillar 3 disclosures under the CRR3.

Summary: The proposal introduces a proportionate framework for ESG disclosures, which includes simplified requirements in the Implementing Technical Standards (ITS) for small and medium-sized banks, without imposing new obligations on large listed institutions.

Context: These proposed amendments are part of the final implementation phase of the Pillar 3 disclosure requirements introduced by the EU’s CRR3 (or revised Banking Package). In particular,

• They clarify reporting on equity exposures and shadow banking.
• They are proportionate to the institution’s type, size, and complexity, offering simplified disclosure rules for non-large banks.
• They align ESG reporting with the EU’s Taxonomy Regulation, particularly for Green Asset Ratio (GAR) templates, and include the adoption of updated NACE codes.
• No new disclosure requirements are introduced for large banks already reporting ESG information; instead, the focus is on streamlining and clarifying existing expectations.

Next steps: Stakeholders are invited to respond to the consultation via the EBA’s website by 22 August 2025.

Malaysia proposes mandatory sustainability assurance framework

Malaysia’s Securities Commission (SC), through its Advisory Committee on Sustainability Reporting (ACSR), has issued a consultation paper proposing a mandatory framework for the assurance of sustainability disclosures.

In summary: The framework aims to enhance the credibility of corporate sustainability information, build investor confidence, and combat greenwashing by requiring independent, reasonable assurance for both climate-related and broader sustainability reports. The proposal outlines a phased implementation timeline from 2027 to 2033, adopts international assurance standards, and establishes the SC’s Audit Oversight Board (AOB) as the regulator for sustainability assurance providers.

In more detail: The proposed framework introduces several key components to build a robust assurance ecosystem in Malaysia:

• Mandatory Phased-in Timelines: The requirement for external reasonable assurance will be implemented in stages, targeting different types of companies and disclosures over time.
• For Scope 1 & Scope 2 GHG Emissions:
  • 2027: Main Market issuers with a market capitalization ≥ MYR 2 billion.
  • 2028: All other Main Market issuers.
  • 2029: ACE Market issuers and large non-listed companies (annual revenue ≥ MYR 2 billion).
• For Broader Sustainability Disclosures (IFRS S1) and Scope 3 Emissions:
  • The same three tiers of companies will be required to comply by 2030, 2031, and 2033 respectively.
• Adoption of Global Standards: To ensure alignment with international best practices, the framework proposes adopting:
  • ISSA 5000 (International Standard on Sustainability Assurance) as the overarching assurance standard.
  • ISQM 1 for quality management within assurance firms.
  • The IESBA Code of Ethics for Sustainability Assurance (IESSA) to govern professional conduct.
• Regulatory Oversight and Competency:
  • The SC’s Audit Oversight Board (AOB) will have its mandate expanded to register, inspect, and enforce standards for all sustainability assurance providers.
  • The framework is ‘profession-agnostic’, meaning both accountants and other professionals (e.g., engineers, sustainability experts) can become registered assurance providers.
  • Lead assurance practitioners must meet stringent competency requirements, including a minimum of six years’ relevant work experience, professional qualifications, recognised sustainability certifications, and 20 hours of continuous professional training annually.

Next steps

• Public Consultation: The immediate next step is the public consultation period, which is open for feedback from all stakeholders until 6 August 2025.
• Framework Finalisation: Following the consultation, the ACSR and SC will review the feedback and move towards finalising the assurance framework and the necessary amendments to the legal and regulatory structure.
• Industry Preparation: Affected companies, particularly large Main Market issuers, must begin preparing for the first wave of mandatory GHG emissions assurance, which will apply to their 2027 reporting cycle. Potential assurance providers will need to prepare to meet the AOB’s registration and competency requirements.