A one-stop, online storehouse of financial and sustainability data reported by EU companies is close to being greenlit, following a provisional agreement between the European Parliament and Council.

First announced in November 2021, the European Single Access Point (ESAP) will mark the first, tangible step on the EU’s path towards Capital Markets Union (CMU): an effort to create a single market for capital across EU member states, with the aim of unlocking growth finance and opening up new opportunities for investment.

According to a European Council statement of 23 May, ESAP’s free, user-friendly and centralised platform will contain data from small as well as large companies, and will facilitate decision-making throughout the EU’s entire investment community.

In parallel, the Council pointed out, by driving circulation of corporate financial and sustainability data between Member States, ESAP will foster the integration of financial services and capital markets within the Union – a major objective of CMU.

Technical efficiency

Importantly, the Council stresses that ESAP imposes no further reporting requirements upon EU companies but will simply provide access to data that businesses have already put in the public domain, in line with relevant directives and regulations.

Under the terms of the agreement, a phased implementation of ESAP will take place. An initial version of ESAP will go live in summer 2027 and to support the aims of the EU’s Green Deal, ESAP will make corporate sustainability data available as early as possible.

The larger, second phase – six months after its launch – will see the inclusion of data that falls within the scope of the Sustainable Finance Disclosure Regulation, the Credit Rating Agencies Regulation and the Benchmark Regulation.

During the third and final phase, the platform will upload information in accordance with around 20 further pieces of legislation, such as the Capital Requirements Regulation, the Markets in Financial Instruments Regulation and the EU Green Bonds Regulation.

Throughout the phasing-in period, officials will carry out regular assessments of ESAP’s functionality, under a review clause in the agreement designed to guarantee that the platform’s technical efficiency will meet the needs of ESAP’s intended users.

Important component

The agreement has been well received. In a statement, Sweden’s Minister for Finance Elisabeth Svantesson hailed it as good news both to European businesses as well as investors worldwide. “We are about to create a platform which will make it much easier to find and compare investment products and companies, including SMEs, which are sustainable and which have a bright financial future. This will help European businesses in becoming even more attractive for investors.”

The agreement also received a warm welcome from Financial Services, Financial Stability and CMU Commissioner Mairead McGuinness, who described the platform as an “important component” of the CMU project: “ESAP will contribute to integrating our capital markets and offer new opportunities for companies as investors will have access to the information they require – financial and sustainability data – on small and large businesses. Also, it will facilitate access to financial products by investors. The ESAP will be a major contributor to the development of EU capital markets and a more sustainable economy and society.” 

ICAEW Climate Change Manager Sarah Reay says: “Once fully operational, the proposed single access point has potential to drive significant levels of capital to green and sustainable products and companies by providing investors with more comparable data. This is an exciting growth opportunity for sustainable finance. However, given the urgency required to tackle sustainability issues today, a four-year wait for the initial version of ESAP is somewhat lacking in ambition.”