FCA ESG Ratings Rules: PS26/22 Sets a 2027 Gateway and a 2028 Go-Live

On 3 November 2026 the Financial Conduct Authority published PS26/22, its final rules for ESG rating providers, together with the Environmental, Social and Governance Ratings Instrument 2026 (FCA 2026/69). The FCA ESG ratings regime goes live on 29 June 2028. From that date, producing and making available an ESG rating that is likely to influence a decision to make a specified investment is a regulated activity under article 63U of the Regulated Activities Order, and a provider carrying it on must hold the relevant permission unless an exclusion or exemption applies. An unauthorised person who breaches the general prohibition in section 19 of the Financial Services and Markets Act 2000 (FSMA) commits an offence under section 23. An already-authorised firm carrying on the activity outside the scope of its permission instead contravenes section 20.

The nearer date is 24 June 2027, when the authorisation gateway opens. Directions the FCA made on 30 October 2026 give providers that forecast £500,000 or more of revenue from the activity, for the 12 months after they apply, a window from 24 June to 29 July 2027. Every other applicant applies between 30 July and 31 August 2027. According to PS26/22, a firm that does not apply within its window, withdraws, or is refused will not be able to take on new business once the regime goes live and will need to wind that business down.

The same rulebook reaches the other side of the trade. Direct users of ratings, such as asset managers and benchmark administrators, gain product-level and rating-level disclosures and advance notice of material methodology changes. Rated companies gain a pre-publication notice, a right to the data behind their rating and a complaints route. For compliance teams at both, the first piece of work is a perimeter call on which products meet the statutory definition of an ESG rating.

Related reading: ESMA July 2026 Q&As: ESG Ratings, MiCA and Consolidated Tape

FCA ESG ratings timeline: SI 2025/1349 to the 29 June 2028 go-live

The legal steps are already in place. HM Treasury made the Financial Services and Markets Act 2000 (Regulated Activities) (ESG Ratings) Order 2025 (SI 2025/1349) on 15 December 2025, and the FCA consulted on its rules in CP25/34 between 1 December 2025 and 31 March 2026. The remaining dates are operational.

The £500,000 forecast does double duty. It decides the application window under the Directions and the application fee category under FEES, and in both places it is measured over the 12 months following the day the application is submitted. That timing is a change from CP25/34: the FCA amended the rule so that firms forecast forward from submission and do not have to produce a figure before the gateway opens. PS26/22 describes the measure as revenue from ESG ratings activities in the UK, while the Directions refer to revenue for doing this activity. A group earning rating revenue both inside and outside the UK has a reason to settle which number it is forecasting before it picks a window.

Legal basis: article 63U, the ESG sourcebook and the Handbook modules that switch on

Part 2 of SI 2025/1349 inserts a new Chapter 15F into the Regulated Activities Order. Article 63U creates the activity, articles 63V to 63Z6 carve it back with exclusions, and article 63Z7 holds the definitions. Under article 2 of the Order, only Part 1 and the enabling provisions are live now: those that let the FCA make rules and directions and let firms apply for permission. Everything else applies from 29 June 2028.

FCA 2026/69 amends the Glossary, PRIN, SYSC, FEES, SUP and DISP, inserts a new chapter ESG 6 (Conduct rules for ESG rating providers) into the Environmental, Social and Governance sourcebook, and adds PERG 19 to the Perimeter Guidance manual. ESG 6 sits after ESG 5 (Disclosure of sustainability-related information) in the same sourcebook that already holds the sustainability label rules in ESG 4; RRD’s note on the FCA’s CP26/17 climate reporting proposals covers another strand of FCA sustainability rules. Apart from Part 1 of the FEES annex, the whole instrument comes into force on 29 June 2028.

The baseline layer is familiar: guidance on the Threshold Conditions in COND, the Principles for Businesses without the Consumer Duty, SYSC including the SM&CR provisions, GEN, and the financial crime provisions of SYSC 6 with the Financial Crime Guide. The FCA is not adding bespoke prudential requirements. Three details in that baseline differ from the standard template:

• SYSC 10 does not apply to ESG rating providers. Conflicts are handled under ESG 6.5, and COBS 11.7 personal account dealing is replaced by an ESG-specific personal transactions policy.
• SYSC 8.1.1R on outsourcing, which is guidance for most firms in Column B of SYSC 1 Annex 1, applies to ESG rating providers as a rule.
• Providers may not treat clients as eligible counterparties for the purposes of PRIN 3.4.1R and PRIN 3.4.2R; PS26/22 wants one baseline of standards whether the client is a sophisticated user or another authorised firm.

The regime regulates how ratings are produced, governed and communicated. It leaves the choice of sustainability view and methodology with the provider; PS26/22 states that the FCA does not prescribe a particular approach and supports methodological diversity.

Who needs FCA authorisation for ESG ratings: the PERG 19 test

Article 63Z7 defines an ESG rating as an assessment of one or more environmental, social or governance factors, produced as an opinion, a score or both, using an established methodology and a defined ranking system of rating categories, whether or not the product is called an ESG rating. A score is derived from data and a pre-established statistical or algorithmic model without substantial analyst input; an opinion involves substantial analyst input. PERG 19.4.1 confirms that an assessment of a company’s governance alone could be within scope.

PERG 19.3.1 turns the perimeter into six questions: whether the activity is carried on by way of business, whether the output is an ESG rating, whether it is likely to influence a decision to make a specified investment (and the provider could reasonably have expected that), whether the provider is in the UK or serves UK persons from abroad, whether an exclusion applies, and whether an exemption applies.

Data product or rating: the ranking-system line

PERG 19.4.3 draws the line at the ranking system. An ESG data product has no defined ranking system; ESG news feeds and datasets of corporate CO2 emissions that are not linked to any ranking are the FCA’s examples. A product moves into scope when it assigns scores, colour codes or categories that rank one rated item against another. The FCA’s own illustration uses the same lost-time injury frequency figure twice: shown alone at 4.3 per million hours worked it is data, and shown as “poor” on a five-point scale it is a rating.

The marketing label settles nothing. PERG 19.4.2 names products sold as an “ESG data product”, an “ESG solution”, a “resilience assessment” or a “transition score” as capable of meeting the statutory definition. Platforms are the hard case: a tool where outputs depend only on user inputs sits on the data side, while one that ships default scores or classifications using the provider’s own methodology sits on the rating side, even if users can change the thresholds. The FCA’s table in PERG 19.4.3 is illustrative only, and the precise analysis turns on the facts of each product.

Two parts of the activity have to be present. Under PERG 19.4.7 the provider must both produce the rating and make it available, so distributing someone else’s ESG rating is outside the activity. Whether a rating was solicited or unsolicited makes no difference.

Likely to influence an investment decision

PERG 19.4.10 lists factors for the influence test: the target audience, whether users apply the ratings in financial services work, how the rating is marketed and described, where it is distributed or embedded, and the contractual terms on acceptable use. In-scope examples include a rating on a publicly traded instrument or fund, a rating commissioned for IPO documentation, a sustainability analytics platform sold to fund managers for portfolio construction, and a physical climate hazard assessment marketed to institutional real estate investors. Products designed, marketed and used for supply chain management, operational compliance or consumer purchasing generally fall outside, but a provider that knowingly markets or permits the same product for investment use is likely to bring it into scope.

Territorially, a provider located in the UK needs permission whoever its users are. An overseas provider needs it when it provides a rating to a person located in the UK and is remunerated for it by anyone, with “remuneration” read widely to include non-financial advantages under article 72(5H).

Exclusions that matter for regulated firms and users

Articles 63V to 63Z6 contain eleven exclusions; PERG 2.8.14GG lists them all. Six of them are summarised below:

• Regulated products and services (article 63V): a rating produced in the course of another activity carried on in accordance with a Part 4A permission is excluded where that other activity is a regulated activity or an ancillary service listed in Part 3A of Schedule 2. The exclusion also covers activities within certain market access arrangements and activities relating to recognised schemes and AIFs marketed under regulations 58 or 59 of the AIFM Regulations. It does not cover a rating supplied as a standalone product.
• Benchmarks and credit ratings (articles 63W and 63X, and 63V for regulated administrators and CRAs): ratings used to produce or incorporated in those outputs are excluded, again unless supplied standalone.
• Private use (article 63Z): a rating supplied under contract that relates solely to the contracting party, where the provider does not reasonably expect it to leave that party’s group.
• Ancillary non-commercial provision (article 63Z1): journalists, academics and charities, but only where there is no relevant remuneration or the rating is occasional and not regularly updated.
• Legal or regulatory requirement (article 63Z4): only where the firm subject to the requirement produces the rating for itself; a third-party rating bought to meet that requirement is not covered.

The standalone carve-back is the trap for regulated firms. PERG 19.6.8 gives the example of an investment firm that includes an ESG rating inside investment research provided as part of advising on investments, which benefits from the exclusion, and the same firm supplying the ratings separately, where the exclusion does not apply. Under PERG 19.6.7, a research house without a Part 4A permission covered by article 63V(1)(a)(i) or (ii) cannot rely on the exclusion and is likely to need permission if no other exclusion applies.

Investment consultants have a separate route. Members of a designated professional body can rely on the Part XX exemption only if their professional body makes ESG rating rules that the FCA approves (PERG 19.7.1).

What ESG 6 requires of ESG rating providers

ESG 6 applies to any firm with permission for providing an ESG rating. It builds on PRIN, GEN, SUP and SYSC and is organised in five sections: governance, systems and controls (6.2), engagement and complaints (6.3), transparency (6.4) and conflicts of interest (6.5), with 6.1 on application.

Governance, systems and controls (ESG 6.2)

ESG 6.2.3R requires governance arrangements and systems and controls that ensure the integrity, independence and reliability of both the ratings and the data used to produce them. Policies must ensure the firm relies on accurate and up-to-date information (6.2.4R), each rating must be consistent with its methodology, and each methodology must be reviewed periodically, defined, thorough and applied systematically (6.2.5R and 6.2.6R). The FCA declined to set a minimum review frequency.

Consistency is about the product line. PS26/22 explains that the rule does not require all providers to use the same methodology; ratings issued from the same product line must be produced under a consistent approach, and an AI-driven methodology can be updated frequently so long as each rating follows the methodology in force. On timeliness, the FCA says a point-in-time rating clearly described as such is unlikely to need updating, while a live rating may need its information refreshed at update or review.

Quality control under ESG 6.2.8R must, at a minimum, check each rating against its methodology and the firm’s processes, verify where relevant that data is timely and accurate, check whether feedback from rated entities has been considered, and include periodic review of ratings other than point-in-time ratings.

Outsourcing has a hard floor. In addition to SYSC 8, ESG 6.2.10R bars a firm from outsourcing (1) operational responsibility for the ESG rating process and (2) the performance of its obligations in ESG 6.2.3R and 6.2.6R. The exception for outsourcing to a member of the firm’s group appears only in limb (2), so operational responsibility under limb (1) stays with the firm itself.

Any outsourcing of part of the rating process, including to a group entity, needs a written agreement setting out each party’s responsibilities (6.2.12R). The UK firm must be able to review any part of the process and make sure necessary changes are made (6.2.11G). PS26/22 adds that UK accountability does not require locating all elements of the process, operational functions or senior personnel in the UK.

Record-keeping under ESG 6.2.15R covers governance decisions, records that let the firm explain and evidence how it produced and determined each rating, methodology changes with reasons, conflicts, personal transactions and complaints. The FCA narrowed the CP25/34 proposal, which would have required data sufficient to reproduce a rating, and did not set a retention period; SYSC 9 applies, read alongside the three-year complaints window.

Transparency in three tiers (ESG 6.4)

The disclosure regime is layered by audience. The table below follows the FCA’s own summary in ESG 6.4.1G.

The public minimum in ESG 6.4.2R is the longest list in the chapter. For each product-line it covers the objective (ESG risk, impact or another dimension), the factors assessed, the meaning of the scale, whether ratings are absolute or relative to a peer group and how the peer group is set, coverage, the engagement approach, a methodology summary and material limitations. The methodology summary alone runs to thirteen items, including weighting and aggregation, data types and sources, forward- or backward-looking timeframe, data estimates, AI use, review frequency, the factors used to judge whether a methodology change is material, the date and general impact of the last material change, and the current methodology version number.

Several changes from CP25/34 reduce the build. Rating-level information that applies across a whole product-line can be disclosed once at product-line level (6.4.11G). No separate document is needed where the information is already in the rating output, such as weights shown in a scorecard or data feed (6.4.13R). “Main data” means the data that materially influenced the rating, not every datapoint. Firms that rely on the trade secrets exemption in 6.4.27R no longer have to explain why the information is a trade secret, but must say what they have withheld on that basis.

Onward sharing matters most to users. Where a provider lets a user share a rating with a third party, the provider must either let the user pass on the related disclosures or give them to the third party directly (6.4.23R). The rule applies only where the information can reasonably be expected to help the third party understand the rating, and a provider does not have to pass on proprietary data from a third-party supplier whose terms forbid onward sharing, unless that supplier is in the provider’s own group.

Methodology changes: advance notice to users only

Before a material methodology change, ESG 6.4.18R requires the firm to consider the likely impact on its ratings and then notify all users of ratings in that product-line, explaining the change, the reasons and the expected impact, with enough time to consider it before the change takes effect. CP25/34 had extended advance notice to rated entities; the final rules drop that. Rated entities instead see the public disclosure of the last material change and can request more. Materiality is the firm’s judgement, guided by ESG 6.4.19G: likely impact on ratings, whether the firm knows the product-line is integrated into users’ products, and whether fundamental characteristics such as KPIs or weightings change. Where a rating is publicly available, a public notice on the firm’s website can serve as the notification (6.4.20G).

Conflicts of interest and personal transactions (ESG 6.5)

ESG 6.5.3R lists what a firm must consider when identifying conflicts, including group structure, the charging model, other services provided to rated entities, and staff incentives and evaluation. The issuer-pays model is the FCA’s named example of a charging-model conflict. Firms must take all reasonable steps to prevent or manage conflicts (6.5.7R), maintain a written conflicts policy reviewed at least annually, publish the policy or a summary of it (6.5.12R and 6.5.13R), and send the governing body written reports on conflicts at least annually (6.5.14R).

Disclosure is the last resort. Only where the firm cannot be reasonably confident that material risks to integrity or independence will be prevented does ESG 6.5.9R require it to publish the conflict, its sources, the resulting risks and the mitigating steps, with an explicit statement that its controls are insufficient. ESG 6.5.11G warns against over-relying on such disclosure. The policy statement’s poor-practice example on issuer-pays providers includes limited oversight of methodology consistency, the same staff in rating and commercial discussions, and no disclosure of the model.

On personal transactions, the FCA dropped COBS 11.7 in favour of ESG 6.5.17R and 6.5.18R. Firms must have arrangements to stop specified persons, meaning those who could materially influence a rating or access inside information about a rated item, from entering into personal transactions that would contravene the Market Abuse Regulation or damage a rating’s integrity or independence, plus a written policy reviewed at least annually. Active monitoring of employee trading is not mandated; PS26/22 expects firms to assess whether monitoring is an appropriate control for their business.

Rated entities: notice, data and corrections (ESG 6.3)

When a firm decides to produce a rating for the first time, ESG 6.3.1R requires it to notify all notifiable persons sufficiently in advance, with a floor of 2 business days, and the FCA does not expect 2 days to be enough in every case. The notice must cover the nature of the rating, the methodology, the main data types (including whether forward- or backward-looking), contact details, and how to request data, request disclosures and report factual errors. Notifiable persons are those reasonably identifiable by the provider: the issuer of a rated item, a rated body corporate or other legal person, and the UK AIFM, SEF manager or RVECA manager of a rated fund. A provider that tried and failed to identify one is not expected to notify.

Publication does not have to wait for the rated entity’s feedback; PS26/22 removed that proposed requirement. A notifiable person can request the data used to assess the rated item at any time under 6.3.4R, and corrections are limited to factual errors.

Complaints outside the Financial Ombudsman (ESG 6.3)

The complaints regime is ESG-specific. A complaint is any written expression of dissatisfaction about any aspect of the rating process that alleges financial loss, material distress or material inconvenience, and it can come from a user, a notifiable person or any other person with an interest in the rating (6.3.8R and 6.3.9R). Making a complaint must be free, the firm need only deal with matters raised within 3 years, the policy must be published on the firm’s website with an expected handling timeline, and the firm must put in place management controls and take reasonable steps to identify and remedy recurring or systemic problems raised by complaints (ESG 6.3.19R; ESG 6.3.20G gives root-cause analysis as an example). The amended DISP excludes complaints about providing an ESG rating from the Financial Ombudsman’s compulsory and voluntary jurisdictions, and the FCA confirmed that FSCS cover will not apply.

Authorisation, SM&CR and fees: what the application has to carry

Applicants must meet the Threshold Conditions and be ready, willing and organised to comply. In assessing applications, the FCA says it will look at resources, governance, systems and controls, conflicts arrangements and oversight of ESG ratings activities, assessed in proportion to the firm’s size and risk.

UK presence is where overseas groups need an answer early. The FCA requires a clear point of accountability in the UK with sufficient senior management presence, oversight and access to information, and will assess operating structures under its approach to international firms. PS26/22 expects that many overseas firms will find a UK-incorporated subsidiary the clearest way to show accountability, particularly where jurisdictional differences limit the suitability of a branch.

ESG rating providers will be Core firms under the SM&CR, with Senior Management Functions other than SMF17, Statements of Responsibilities, the Conduct Rules and the Certification Regime, although the FCA expects few if any certification functions in these firms. The FCA considered its own SM&CR Phase 2 consultation, CP26/37, and the PRA’s CP14/26 (covered in our note on PRA CP14/26 and SM&CR Phase 2) and does not expect them to materially affect the Core firm requirements for providers.

For new Part 4A authorisation applications, the A.27 pricing categories are set out below. An already-authorised firm applying to add ESG rating activities must calculate its variation-of-permission fee separately under FEES 3 Annex 16R. Where the proposed activity falls within an activity group for which the firm holds no existing permission, that Annex generally specifies 50% of the highest relevant pricing category.

The FCA raised the threshold from the £250,000 it consulted on. PS26/22 (paragraph 9.17 and Table 1) says every application after the gateway closes pays Category 4. In FCA 2026/69, Part 1 of the FEES annex (in force from 3 November 2026) ties Category 6 in activity group A.27 of FEES 3 Annex 1R to a forecast of £500,000 or more for the 12 months after submission, with no gateway condition. Part 2 (in force from 29 June 2028) deletes that Category 6 row, leaving Category 4 for every A.27 application from go-live. The two rows above for applications outside the gateway windows therefore apply before 29 June 2028 only; an applicant planning to apply outside the gateway windows should confirm the fee category with the FCA before budgeting.

Further information on the annual fees that will recover ongoing supervisory costs is due in the FCA’s regulatory fees and levies consultation, which PS26/22 says will be published later in November 2026.

Timing carries the real consequence. The FCA’s guidance on the regime notes that submitting an application does not guarantee authorisation and that late applicants may not get a decision before go-live. Under article 10 of the Order, a firm that applied within its relevant application period and is still awaiting a decision on 29 June 2028 can continue its ESG rating business, including new business, while its application remains pending, provided the FCA has not issued a direction under article 11(3) placing it within the narrower transitional regime. RRD’s note on the FCA cryptoasset regime authorisation gateway covers another FCA regime run on a pre-commencement application window.

Regulatory reporting after go-live: information requests first, Handbook returns later

Reporting for ESG rating providers begins with mandatory information requests and moves into the Handbook later. PS26/22 confirms the phased approach consulted on: from 29 June 2028 regulated providers will submit regulatory reporting returns, but as non-Handbook requirements, with the FCA issuing information requests on a mandatory basis. After a period of testing in that live environment, the FCA will consult on and finalise Handbook reporting rules. A voluntary pilot ran in 2026 to test reporting metrics for availability, quality and usefulness.

The data set is still open. Annex 3 of PS26/22 says that, subject to final development, the data could include methodology updates, complaints data and product reviews, and that the FCA will explore whether complaint categories would be useful. The ESG 6.2.15R records, which already capture methodology changes with reasons, conflicts and each complaint with its resolution, are a likely source for any of those requests.

The SUP amendments remove several standard returns for firms whose only permission is providing an ESG rating:

• SUP 16.4 (annual controllers report) and SUP 16.5 (annual close links reports), a carve-out that also covers firms whose only permissions are administering a benchmark and providing an ESG rating.
• SUP 16.26, reporting of information about Directory persons.
• SUP 16.30, the Baseline Financial Resilience Report (FIN 073).

These carve-outs follow the permission profile of the authorised entity. On that wording, a bank, asset manager or investment firm that adds the ESG rating permission to existing permissions keeps the SUP returns it already files.

What changes for users of ESG ratings and rated companies

An ESG rating user, in the Glossary definition, is a person who has paid a provider for the use of a rating or accessed a rating directly from a provider for free. That user receives the detailed product-line and rating-level disclosures on first access, updates after material changes, advance notice of material methodology changes, and the onward-sharing rights described above. Indirect and prospective users, such as investors reading a rating through a platform, rely on the public disclosures and on onward sharing.

ESG 6 places its conduct rules on the provider. The Consumer Duty does not apply to ESG rating providers, and PS26/22 states that responsibility for complying with the Duty remains with firms within its scope. The transparency rules require disclosures to be clear and easy to understand for their intended audience, which may include distribution-chain firms subject to the Duty; the FCA describes this as a Duty-aligned measure.

Users that produce their own ratings face open questions. The FCA will run a targeted desk-based review of asset managers’ proprietary ESG ratings used in fund marketing materials and then consider next steps. It sees no need for further action on benchmark administrators while the Treasury’s benchmark regime reform is ongoing, will monitor investment research for emerging harms, and is engaging with designated professional bodies on investment consultants.

For rated companies, the regime adds the notice before a first rating, data access at any time, a factual correction route, product and rating disclosures on request and the complaints procedure. The notice duty is tied to first availability (ESG 6.3.2G), so later updates to an existing rating do not trigger it.

For a user firm’s compliance team, the regime reduces to three facts per vendor: the legal entity that produces and provides each rating the firm relies on, whether that entity applied within its window, and whether the contract allows the firm to pass both ratings and disclosures to its own clients.

UK and EU ESG ratings rules side by side

Groups operating in both markets are already working under the EU ESG Rating Regulation, Regulation (EU) 2024/3005, which has applied since 2 July 2026. PS26/22 says its final approach remains consistent with IOSCO’s recommendations and with rules in other jurisdictions such as the EU, and the 2-business-day notice floor was set partly to remove friction for firms operating across both regimes. The two still differ on supervisor, timing and third-party distribution.

From 29 June 2028, firms carrying on the regulated activity of providing ESG ratings in the UK must hold FCA authorisation and the relevant permission, unless a statutory exclusion or exemption applies. PS26/22 also states that decisions on market access routes such as equivalence are a matter for government. On the current text, an ESMA authorisation does not answer the UK question.

Frequently Asked Questions

We are an FCA-authorised fund manager and publish in-house ESG scores in our fund marketing. Do we need the new permission?

Probably not for that use. PERG 19.6.8 describes a fund manager whose in-house ratings are used to build, manage and market its own products and client mandates and are not available for independent use; that activity would likely benefit from the article 63V exclusion. The answer changes if the same ratings are also distributed through a third-party data platform for users’ own purposes, which PERG treats as standalone provision likely to need permission. The FCA’s planned desk-based review of proprietary ratings in fund marketing is a separate supervisory exercise.

An overseas provider gives headline scores away on a public website and sells a detailed feed to UK subscribers. Which part is in scope?

The free website falls under the overseas persons exclusion in article 72(5G) where no remuneration of any kind, including a non-financial advantage, is received from anyone for those ratings. The paid feed to UK-located persons is in scope. PERG 19.5.2 also closes the intermediary route: routing ratings through an overseas distributor stays in scope where the provider reasonably expects them to reach a UK person.

What if we apply outside our window, or are refused, and are not authorised by 29 June 2028?

Article 9(5) of the Order permits applications outside the designated windows. However, under article 11(1), a pending out-of-window application qualifies for the limited transitional arrangements only if it was submitted before 29 June 2028. Article 11(2) applies the same regime to an in-window applicant whose application is refused or withdrawn, and articles 12 and 13 treat either person as exempt only for the article 63U activity needed to perform a pre-existing contract or maintain a pre-existing public ESG rating. Article 14 requires notification to the FCA, article 15 requires the firm to tell contract counterparties and users of its ratings that it is exempt, and the chapter ceases to have effect one year after go-live. The FCA can also direct, in limited cases tied to its operational objectives, that a pending in-window applicant falls under this regime instead.

Do ratings already published before June 2028 trigger the 2-business-day notice?

No. ESG 6.3.2G limits the notice to the first time a rating is made available, and PS26/22 confirms the rules do not apply retroactively. The FCA mentions notifying rated entities of pre-existing ratings as optional best practice, and those entities still have the data request, correction and complaints rights.

Our controversy scores change daily. Does each change need a new notification?

No. PS26/22 expects rated entities to be notified before coverage begins, after which score changes do not require notification. Automated products with very wide coverage are still expected to comply with the notification rule before first coverage.

Can a rated company use the complaints procedure to contest its score?

The FCA says the complaints framework should not be used to challenge rating opinions and creates no right of appeal against methodologies, assumptions or analytical judgements. It also declined to restrict complaints to factual inaccuracies, so a complaint about another aspect of the rating process can still qualify under ESG 6.3.9R, and the firm decides whether it is valid and needs investigation. Corrections are limited to factual errors; disagreement with the methodology goes through the feedback procedure in ESG 6.3.5R.

Does an ESG rating provider need an MLRO or an SMF17?

SMF17 (Money Laundering Reporting) is excluded from the SMFs that apply, and the amended SYSC 6.3.9R removes the duty to appoint an MLRO for ESG rating providers. The financial crime provisions of SYSC 6 and the Financial Crime Guide still form part of the baseline standards.

Related Articles

• ESMA July 2026 Q&As: ESG Ratings, MiCA and Consolidated Tape: ESMA’s July 2026 answers on the EU ESG Rating Regulation alongside MiCA and consolidated tape questions.
• FCA Cryptoasset Regime: What UK Crypto Firms Must Do Before the Authorisation Gateway Closes: another FCA regime built around a pre-commencement authorisation gateway.
• SM&CR Phase 2: PRA CP14/26 Proposals, Responses Due 22 January 2027: the PRA side of the SM&CR Phase 2 reforms the FCA considered for ESG rating providers.
• FCA Climate Reporting Rules: Simpler TCFD Product Disclosures Under CP26/17: the FCA’s proposed changes to climate-related product disclosures.
• FCA Handbook API: What It Covers, How Access Works and Its Limits: tracking Handbook changes such as the new ESG 6 and PERG 19 text programmatically.

Key Takeaways

• Pick the window from a 12-month forward revenue forecast: £500,000 or more applies 24 June to 29 July 2027; below that, 30 July to 31 August 2027.
• For new Part 4A authorisation applications, the A.27 pricing category follows the 12-month revenue forecast during the gateway: Category 6 at £500,000 or more and Category 4 below £500,000. PS26/22 says Category 4 for applications after the gateway; the FCA 2026/69 rule text keeps the forecast test until 29 June 2028, when Part 2 deletes the Category 6 row and leaves Category 4, so confirm the category with the FCA for any application between the gateway and go-live. Firms varying an existing permission must calculate their application fee under FEES 3 Annex 16R.
• Test each product for a defined ranking system before relying on a “data product” label; default scores inside an analytics platform count.
• Build a first-rating notice into the production calendar: 2 business days is the floor, and the content list in ESG 6.3.1R(2) is fixed.
• Publish the factors used to judge methodology materiality and the current version number; users, not rated entities, get the advance change notice.
• Plan regulatory data around mandatory information requests from 29 June 2028, with Handbook reporting rules to follow consultation.
• Overseas groups: settle branch or UK-incorporated subsidiary before the first PASS meeting, since the FCA assesses the structure case by case under its approach to international firms.

Sources and References

• FCA, press release: New FCA rules bring ESG rating providers into UK regulation for the first time (3 November 2026): fca.org.uk
• FCA, PS26/22: ESG ratings: final regime (web page): fca.org.uk
• FCA, PS26/22: ESG (Environmental, Social, Governance) ratings: Final regime, including Appendix 1, Environmental, Social and Governance Ratings Instrument 2026 (FCA 2026/69, FOS 2026/7), with ESG 6 and PERG 19: ps26-22.pdf
• FCA, Directions under the Financial Services and Markets Act 2000 (Regulated Activities) (ESG Ratings) Order 2025 (30 October 2026): direction-esg-ratings-fsma-2000-si-2025-1349.pdf
• FCA, Preparing for the new ESG ratings regime (authorisation page): fca.org.uk
• FCA, CP25/34: consultation on the ESG ratings regime: cp25-34.pdf
• UK legislation, The Financial Services and Markets Act 2000 (Regulated Activities) (ESG Ratings) Order 2025, SI 2025/1349: legislation.gov.uk
• FCA Handbook, SUP 16 Reporting requirements: handbook.fca.org.uk
• FCA Handbook, FEES 3 Annex 16 Fees for an application for variation of permission: handbook.fca.org.uk
• UK legislation, Financial Services and Markets Act 2000, sections 19, 20 and 23: legislation.gov.uk
• IOSCO, Environmental, Social and Governance (ESG) Ratings and Data Products Providers, Final Report: IOSCOPD690.pdf
• EUR-Lex, Regulation (EU) 2024/3005 on the transparency and integrity of ESG rating activities: eur-lex.europa.eu
• ESMA, Public Statement ESMA84-1427279869-1396: Publication or distribution of ESG ratings by third parties in the period from 2 July 2026 until authorisation, recognition or registration of ESG rating providers (1 July 2026): esma.europa.eu

Before the June 2027 gateway: perimeter memo, revenue forecast, PASS

The work before 24 June 2027 produces three artefacts. The first is a perimeter memo that runs each product and each group entity through the PERG 19.3.1 questions, records which exclusion is relied on, and flags any product sold standalone. The second is the 12-month revenue forecast that fixes both the application window and the fee category. The third is the governance and operating model the application will describe, including where UK accountability sits and which parts of the rating process are outsourced and to whom. The FCA’s webinar on the policy statement comes first, on 7 December 2026; PASS, available from February 2027, is where a provider can test that memo and its specific scenarios with the FCA before its window opens.

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