Sustainability continues to gain importance in the financial market as well. Their implementation status in the individual institutions is surveyed in the annual meeting with the banking supervisory authority. Since the consultation of the 7th MaRisk amendment, additional new requirements regarding sustainability have been included in various areas of the minimum requirements for risk management (BA); final publication is expected in 2023. This brings the implementation of sustainability even more into the focus of supervision.

Preparation for the supervisory interview 1/3

The persons participating in the supervisory discussion on the part of the banks and financial services companies should deal with the topic of ESG more intensively in advance. Good and thorough preparation for the interview is one of the most important factors for success. This group of persons includes the members of the Board of Management, the managing directors and the heads of risk management. In addition to the supervisory discussion, the topic of sustainability is also becoming more prominent in the context of Section 44 of the German Banking Act (KWG) audits, is being scrutinized more closely, and is being discussed by the supervisory authority with the institutions.

The following information or summaries can be used for this purpose:

BaFin homepage– Search term “sustainability”, “ESG
BaFin fact sheet on dealing with sustainability risks Status: 13.01.2020 Basics of sustainability from the perspective of banking supervision
BaFin: The German Financial Sector and Sustainability Risks: A State-of-the-Art Survey by BaFin – From October 2021 Status report on implementation in the financial industry
BaFin: Draft of the 7th MaRisk amendment dated 26.09.2022 Content basis of the consultation paper
Internal company ESG implementation status

Overview of own ESG implementation status such as.

  • Business distribution plan with ESG assignment (e.g. ESG officer).
  • ESG Annual Report
  • ESG Strategy
  • ESG structure and process organization
  • Risk identification of ESG risks across all risk types
  • Measurement of ESG risks
  • ESG Data Histories
  • ESG Stress Scenarios
  • ESG risk-bearing capacity
  • ESG reporting (part of the risk report)

At the latest with the publication of the final 7th MaRisk amendment, the requirements formulated in MaRisk will have to be implemented taking into account the proportionality principle. It is expected to be published before the end of 2023. In the supervisory meeting, the ESG implementation statuses in the individual houses can also be questioned. In particular, the following topics should be included in the preparation:

  • perspective, for example by means of an ESG project or the implementation of the 7th MaRisk amendment,
  • Objective and open-minded arrival in all areas,
  • Demonstrate ESG depth knowledge that may be required. For example, the active participation of management in the steering committee of ESG projects in the sense of “tone-on-the-top“, as well as for the perception of the role model function, is welcome,
  • Presentation of ESG information on the homepage:
    – ESG approach of the company / ESG strategy / ESG measures
    – How does the institute approach clients about ESG?
    – What is the ESG vision of the institute?
    • Information on employee involvement, e.g. job ticket, flexible working hours, home office,
    • Information on how to promote key ESG projects, such as biking to work, promoting alternative vehicles, or promoting energy efficiency,
    • Networking of the institute and its ESG activities with other institutes, associations, initiatives, for example ESG platforms of banking associations, regional initiatives, ESG initiatives, ESG platforms etc.,
    • Promote ESG business activities, e.g., loan programs for solar and wind farm promotion, consumer loans e-cars, etc…,
    • Information on how to prepare your own energy balance sheet, both for the institute and for employees,

    A “no-go”, on the other hand, is a lack of ESG activity on the part of the financial company to date.

    Scope of regulation

    A comprehensive ESG implementation is to be expected by means of the 7th MaRisk amendment. Its draft has been available for consultation since September 2022. Institutions can therefore already prepare for compliance with the new requirements as part of their MaRisk/ ESG implementation projects.

    Our recommendation

    Deal with the ESG topics and the internal implementation status as soon as possible and check which preparations are necessary for the supervisory meeting. We at ADWEKO and Regulartech-IT-Audit-Consult are happy to support you in ESG preparation and implementation as well as in determining your implementation needs and efforts.

    Johannes Hugo

    Johannes Hugo
    Head of Business Unit IT-Security

    Axel Becker

    Alex Becker
    Head of Business Unit IT-Security



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