EBA publishes final guidelines on ESG risk management, requiring institutions to identify, measure, manage, and monitor risks, and prepare plans to address financial risks from ESG factors

Institutions must develop plans that align with EU transition efforts. They are set to apply from 11 January 2026 for most institutions with an extended deadline for smaller entities. They complement other sustainable finance actions outlined by the EBA. These guidelines are part of the EU’s broader strategy to promote sustainable finance and ensure the stability of financial institutions in light of intensifying ESG challenges…