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MiFID ESG Requirements go Live, Compliance Caution Urged

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The ESG reporting requirement under the amended Markets in Financial Instruments Directive (MiFID II) came into effect this week, with warnings from some market participants that the new regulation would add more costs and challenges to compliance teams. Financial infrastructure and data provider SIX, however, said the obligations needn’t overwhelm firms.

“Regulatory complacency is unwise for firms at this time, as the introduction of additional ESG requirements could add ongoing MiFID compliance issues. However, much of the sustainability data and criteria needed to comply with the suitability requirements under the MiFID II update is the same as that housed already for the EU SFDR and the Green Taxonomy,” said Janine Hofer-Wittwer, Senior Product Manager of Financial Information at SIX. “For market participants, the goal is to work with data providers able to source and distil the data and provide it in a way that is easy to implement, minimising the lift needed for the latest and future ESG regulatory requirements.”

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