Singapore Finalises ESG Rating and Data Providers Code of Conduct

The Monetary Authority of Singapore (MAS) has issued its final Code of Conduct for ESG rating and data product providers, as well as an accompanying checklist for providers to use to self-attest compliance. The code’s goal is establish baseline industry standards for transparency in methodologies and data sources, governance, and conflicts of interest management – building on the IOSCO recommendations for ESG ratings and data product providers. Under the code, providers should regularly review their methodologies and data sources, as well as provide quality assurance to verify their sources of data and disclose changes to methodologies where they are material. The Code of Conduct was proposed in a public consultation ending August 2023, which received almost 50 responses expressing “strong support”. It is a voluntary code and will be applied on a “comply or explain” basis. MAS encourages ESG ratings and data product providers to disclose their adoption of the code and publish their completed checklist within 12 months. Tuang Lee Lim, Assistant Managing Director for Capital Markets at MAS, said that the code will “help build market confidence” in the use of ESG rating and data products and “support informed decision making by investors keen on funding the climate transition”.

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