The UK’s Financial Conduct Authority (FCA) has announced the formation of a group to develop a new code of conduct for ESG data and ratings providers. The regulator had proposed introducing regulatory oversight of ESG data and ratings providers earlier this year. The ESG Data and Ratings Code of Conduct Working Group (DRWG) will be co-chaired by M&G, Moody’s, London Stock Exchange Group (LSEG) and Slaughter and May, and will be composed of stakeholders including investors, ESG data and ratings providers, and rated entities, and will aim to meet later this year. If the UK’s HM Treasury allows the FCA to expand its regulatory parameters, the body says it is “committed to take the necessary steps” to develop and consult on a proportionate and effective regulatory regime, with a focus on outcomes in areas highlighted in the International Organization of Securities Commissions’ recommendations, including transparency, good governance, and management of conflicts of interest. The code of conduct could also continue to apply for ESG data and ratings providers that fall outside the scope of potential future regulation, the FCA said.