This final report aims to update the guidelines on the governance of retail banking products in response to the European Commission's request regarding greenwashing. It proposes recommendations to enhance prudential and conduct supervision of banking products by integrating environmental, social, and governance (ESG) considerations. The amendments aim to clarify existing requirements and strengthen consumer…
The document is the final report of the European Banking Authority (EBA) published on 30 June 2026, referenced EBA/GL/2026/07. It is an amended guide of the guidelines (Guidelines) on retail banking product oversight and governance arrangements (POG Guidelines), integrating products with ESG (Environmental, Social, and Governance) features and greenwashing risks. The scope covers retail banking products such as mortgages, consumer credits, deposits, payment accounts, payment services, and electronic money, within the European Union, with implementation planned from 11 January 2027. The document comprises approximately 49 pages, of which only the first 35 were provided for this synthesis (pp. 1-35).
- Subject: Update of the POG guidelines to integrate retail banking products with ESG features and combat greenwashing.
- Importance: Greenwashing is increasing across all sectors, including EU banks, which can mislead consumers and harm market trust.
- Key findings:
- The 2016 POG Guidelines remain relevant but require adaptation to explicitly integrate ESG and greenwashing risks.
- The European regulatory framework has evolved with amendments to the CRD, CRR, and the Unfair Commercial Practices Directive (EmpCo Directive 2024/825/EU).
- The POG scope is extended to consumer credits provided by non-banks under the CCD Directive.
- Requirements for prevention, management, and monitoring of greenwashing risks are clarified and strengthened, notably via references to EBA ESG risk management guidelines (MESGR).
- The outsourcing chapter is removed and replaced by a reference to EBA third-party risk management guidelines (SMTPR).
- Conclusions: The amendments are targeted, proportionate, and aim to strengthen consumer protection without creating new major procedural obligations. Implementation is aligned with MESGR guidelines on 11 January 2027.
- Recommendations: Competent authorities must integrate these guidelines into their practices and notify their compliance to the EBA. Financial institutions must adapt their internal product governance processes, notably regarding ESG and greenwashing, and ensure training of relevant staff (pp. 4-5, 6-16, 18-23).
- Context: Since 2016, the POG Guidelines aim to frame the design and distribution of retail banking products to protect consumers and ensure effective internal governance. Reports from 2019 and 2020 revealed implementation gaps, but the substance of the guidelines remained adequate.
- Issue: The increase in risks related to products with ESG features and greenwashing, as well as recent regulatory developments (CRD/CRR amendments, EmpCo Directive, inclusion of non-bank consumer credits in EBA scope) require an update of the POG Guidelines.
- Stakes: Strengthen the fight against greenwashing, ensure regulatory coherence, protect consumers, and guarantee stability and trust in the retail banking market.
- Objectives: Update the POG Guidelines to explicitly integrate requirements related to ESG products and greenwashing risks, clarify the scope, and align requirements with other EBA guidelines (MESGR, SMTPR).
- Limits: The document does not create new major procedural obligations nor detailed definitions of ESG products, but aims for a targeted and proportionate approach (pp. 6-16).
Scope and definitions:
- Extension of the POG Guidelines scope to consumer credits provided by non-banks under the CCD Directive, acknowledging national divergences in transposition (pp. 9-11).
- Removal of certain obsolete references (e.g., outsourcing chapter) and addition of cross-references to MESGR and SMTPR guidelines for greater coherence (pp. 13-14, 19).
Prevention and management of greenwashing:
- Obligation for manufacturers' governing bodies to implement robust processes to identify, prevent, manage, and monitor greenwashing and perceived greenwashing risks, consistent with MESGR guidelines (pp. 11-13, 20-21).
- Clarification that prevention must occur before and after any greenwashing event, covering product design, approval, monitoring, and review (pp. 11-12).
Information and communication:
- Strengthened requirements for manufacturers to provide distributors with fair, clear, non-misleading, and up-to-date information on products' ESG features to avoid greenwashing (pp. 12-13, 22-23).
- Shared responsibility between manufacturers and distributors to ensure quality of communications on ESG products (p. 15).
Third-party management:
- Removal of the dedicated outsourcing chapter in the POG Guidelines, replaced by a reference to EBA third-party non-ICT risk management guidelines (SMTPR), to avoid complexity and ensure coherence (pp. 13-14).
Application and timeline:
- Application date set to 11 January 2027, aligned with MESGR guidelines, to allow proportionate adaptation, notably for small institutions (SNCI) (pp. 14-15, 36).
Proportionate approach and principles:
- Maintenance of a principle-based approach, allowing institutions flexibility to adapt measures according to their nature, size, complexity, and risks (pp. 15, 35).
- No introduction of thresholds or additional definitions of ESG products, nor detailed examples, to avoid complexity and respect existing legal frameworks (pp. 32-34).
Stakeholder dialogue:
- Feedback from the Banking Stakeholder Group (BSG) with divergent views: support for updates and scope extension, but concerns on complexity, proportionality, and clarity of definitions (pp. 27-29).
- The EBA responds by reaffirming the legal basis, the necessity of updates, and coherence with other texts (pp. 28-29).
- Established facts:
- The 2016 POG Guidelines remain relevant but require targeted adaptations to integrate ESG and greenwashing risks.
- The scope is expanded to non-bank consumer credits under the CCD Directive.
- The EBA received 13 responses to the public consultation, with broad support but also criticisms regarding complexity and proportionality.
- Assumptions:
- Financial institutions will apply the guidelines in a proportionate manner adapted to their size and complexity.
- Reference to MESGR and SMTPR guidelines will ensure regulatory coherence without creating new heavy obligations.
- Interpretations:
- The EBA considers that greenwashing risks justify explicit inclusion in the POG Guidelines.
- The targeted and limited approach of the amendments is sufficient to strengthen consumer protection without increasing regulatory burden.
- Uncertainties:
- Variable impact depending on national transposition of the CCD Directive.
- Some concerns remain on clarity of ESG definitions and burden for small institutions, although proportionality is integrated (pp. 6-16, 24-37).
- The EBA confirms the need to update the POG Guidelines to explicitly integrate requirements related to products with ESG features and greenwashing risks, consistent with recent regulatory developments.
- The amendments are targeted, proportionate, and do not create new major procedural obligations.
- The removal of the outsourcing chapter and reference to SMTPR guidelines simplify the framework while ensuring adequate third-party risk management.
- The application date is set to 11 January 2027, aligned with MESGR guidelines, to allow harmonized and realistic implementation.
- Competent authorities must integrate these guidelines into their practices and notify their compliance to the EBA within deadlines.
- Financial institutions must adapt their internal processes, notably product governance, staff training, greenwashing risk management, and communication on ESG products.
- The document recommends reading the POG Guidelines in conjunction with MESGR and SMTPR guidelines for a coherent and comprehensive approach (pp. 4-5, 18-23, 28-29).
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