Weekly highlights

Weekly highlights

The Lexis®+ UK Environment team produce a weekly roundup of key current awareness and legal updates. The highlights also include analysis of

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Latest Environment News

ESMA publishes report on 2023–2024 CSA examining sustainability risks and disclosures

The European Securities and Markets Authority (ESMA) has published its final report on the 2023–2024 Common Supervisory Action (CSA), conducted in cooperation with national competent authorities (NCAs), on the integration of sustainability risks and disclosures in the investment management sector. The CSA assessed compliance with the Sustainable Finance Disclosures Regulation (EU) 2019/2088 (EU SFDR), the Taxonomy Regulation (EU) 2020/852, the Alternative Investment Fund Managers Directive (Directive 2011/61/EU) (AIFMD), and the Undertakings for Collective Investment in Transferable Securities Directive (Directive 2009/65/EC) (UCITS). The report states that the overall level of compliance was satisfactory but identifies areas for improvement in the integration of sustainability risks and in entity- and product-level disclosures under the EU SFDR. The CSA also contributed to ESMA’s work on greenwashing. The report notes that NCAs took supervisory actions to address identified issues and will continue engaging with market participants and following up on vulnerabilities.

DESNZ publishes Solar Roadmap to accelerate UK solar deployment by 2030

The Department for Energy Security and Net Zero (DESNZ) has published a Solar Roadmap outlining over 70 actions to support the deployment of 45–47 GW of solar capacity across the UK by 2030. Key measures include: (1) streamlining the grid connection process for solar projects; (2) strengthening the solar supply chain to ensure it is resilient, diverse and sustainable; (3) reaffirming the government’s commitment to eradicating modern slavery and forced labour; and (4) introducing proposals for mandatory community benefit funds for local areas provided by developers. The Roadmap sets out a strategic framework for expanding solar deployment across homes, businesses and public infrastructure, while supporting energy affordability and economic growth. It also presents the final conclusions of the Solar Taskforce, which re-convened in autumn 2024.

ESAs jointly consult on draft guidelines for ESG stress testing in banking and insurance

The three European Supervisory Authorities (the European Banking Authority, the European Insurance and Occupational Pensions Authority and the European Securities and Markets Authority—ESAs) have published a joint consultation paper on 27 June 2025 containing draft guidelines for integrating environmental, social and governance (ESG) risks into supervisory stress tests for banks and insurers. Developed pursuant to Article 100(4) of the Capital Requirements Directive (Directive 2013/36/EU) and Article 304c(3) of the Solvency II Directive (Directive 2009/138/EC), the guidelines aim to ensure consistency, long-term considerations and common standards in ESG stress testing methodologies across the EU financial sector. They outline expectations for competent authorities regarding the design, governance and operational features of such stress tests, including the need for relevant expertise, access to high-quality ESG data and appropriate timelines for scenario analysis. Responses are sought by 19 September 2025, with a public hearing scheduled online for 26 August 2025.

EIOPA publishes first supervisory report on biodiversity risk management by insurers

The European Insurance and Occupational Pensions Authority (EIOPA) has published its first supervisory report examining how EU (re)insurance undertakings are identifying, measuring and managing biodiversity-related risks under the Solvency II framework. The report notes that while some insurers have begun to incorporate biodiversity loss into their risk assessments, integration remains limited and primarily qualitative. Biodiversity loss is described as a complex and multidimensional risk with potential implications for investment values, insured losses and the overall risk profile of insurers’ portfolios. The report also highlights the interconnection between biodiversity and climate-related risks, particularly in relation to natural catastrophes, and observes that approximately 30% of insurers’ corporate bond and equity exposures depend on at least one ecosystem service.