On 3 November 2026, the Financial Conduct Authority (FCA) published Policy Statement 26/22 ‘ESG ratings: final regime’ (PS26/22).
Background
On 1 December 2025, the FCA published Consultation Paper 25/34 (CP25/34) on its proposed approach to Environmental, Social, Governance (ESG) ratings regulation. The deadline for comments on CP25/34 was 31 March 2026.
On 18 December 2025, there was published on legislation.gov.uk The Financial Services and Markets Act 2000 (Regulated Activities) (ESG Ratings) Order 2025 (the ESG Ratings Order) together with an explanatory memorandum. The ESG Ratings Order brings the provision of an ESG rating into regulation under the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO), by making it a specified kind of activity, when that rating is likely to influence a decision to make an investment specified in Part 3 of the RAO. The ESG Ratings Order inserts a new Chapter 15F into the RAO which defines the scope of the new regulated activity (article 63U) and sets out a number of exclusions (articles 63V to 63Z5), including exclusions for regulated products and services, unregulated benchmarks, unregulated credit ratings, intra-group ratings, private use, ancillary non-commercial provision, public authorities, central banks and international organisations, accreditation or certification, regulatory or legal requirements, and proxy advice.
Summary
PS26/22 contains the FCA’s final rules and guidance for ESG rating providers. It reflects feedback from CP25/34 and government legislation to bring ESG ratings into regulation.
The FCA reports that there is clear support for bringing ESG ratings into FCA regulation and that respondents broadly supported the proposal to apply baseline FCA standards to ESG rating providers. The FCA have maintained most of the proposals it consulted on and have made limited changes. Its main updates are to the transparency and stakeholder engagement proposals, to improve clarity, proportionality and support practical implementation. In other areas, the FCA have provided further clarification, including some case study examples for conflicts of interest (Chapter 5). Annex 1 of PS26/22 contains a summary of the regime and key changes.
Directions
The FCA has issued Directions under Article 9 (Relevant application period) of the ESG Ratings Order.
Next steps
From 29 June 2028, all ESG rating providers in scope will need to be FCA‑authorised to carry out ESG ratings activity in the UK. Beyond this date, firms that carry on ESG ratings activity without the required authorisation will be in breach of the general prohibition under Financial Services and Markets Act 2000 and will be committing a criminal offence.
The FCA states that all ESG rating providers need to:
- Review PS26/22 to understand the future regime they will be subject to.
- Consider the FCA’s Perimeter Guidance (PERG) alongside the statutory instrument to assess whether the products they provide fall within the scope of the regime.
- Prepare for the application process ahead of the authorisation gateway opening on 24 June 2027. The FCA’s pre‑application support service will be available from February 2027 to support firms with their applications.
Users of ESG ratings, rated companies and other affected or interested stakeholders should read PS26/22 to understand the new regime.
FCA webinars
The FCA will be holding the following webinars:
- 7 December 2026: Policy Statement webinar: register and submit questions.
- 26 January 2027: Authorisations webinar: registration opens soon.
ICMA Code of Conduct
The FCA states that the International Capital Market Association (ICMA) Code of Conduct will continue to operate alongside the regime. It will remain relevant for ESG data providers that fall outside the scope of regulation. As an internationally recognised standard, it will also continue to support good practice globally.
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