Response to consultation on Guidelines on product oversight and governance arrangements for retail banking products
Question 1. Do you have any comments on the targeted amendments and consequential changes made to Chapter 2 of the POG Guidelines on ‘subject matter, scope and definitions’?
Basic principles
The German Banking Industry Committee (GBIC) sees no requirement for a revision of the Guidelines on Product Oversight and Governance Arrangements for Retail Banking Products (POG Guidelines).
- The risks from any greenwashing and the prevention of unfair practices have already been comprehensively addressed in the directive on empowering consumers for the green transition (Directive (EU) 2024/825, EmpCo).
- The requirements of the current POG Guidelines (EBA/GL/2015/18) already refer to all risks from a consumer perspective which, where relevant in individual cases, may also include ESG risks.
- The blanket references to the EBA Guidelines on the management of ESG risks (EBA/GL/2025/01) appear to be unjustified as these guidelines take into account the institution’s perspective on risks (prudential perspective) and not, as in the POG Guidelines, the consumer's perspective.
- Finally, it should not be overlooked that institutions are already paying particular attention to greenwashing risks when developing and offering sustainable products and communicating sustainable goals. They have established various processes and control mechanisms to avoid these risks. For example, as part of the New Product Process for sustainable products, institutions regularly check whether there are any greenwashing risks. We do not see any added benefit from a revision of the POG Guidelines.
Nevertheless, if a revision of the POG Guidelines were to go ahead, the following aspects should be taken into account here:
- As part of the upcoming revision of the POG Guidelines, the current rules should be shortened considerably in order to reduce bureaucracy and unnecessary regulatory complexity, as we believe, if unchanged, the auditing and documentation obligations resulting from the Guidelines are too extensive. This is because regulated products are largely risk-free for consumers (e.g. current / payment accounts) and/or already heavily regulated by other provisions (consumer credit).
- Furthermore, if references to the EBA Guidelines on the management of ESG risks (EBA/GL/2025/01) are kept, it should be noted that these will apply to small and non-complex institutions (SNCI) only from 11 January 2027 onwards. Accordingly, the application date of the revised POG Guidelines for SNCIs should not be before this date.
Question 1: Do you have any comments on the targeted amendments and consequential changes made to Chapter 2 of the POG Guidelines on ‘subject matter, scope and definitions’?
The EBA Guidelines on the Management of ESG Risks (EBA/GL/2025/01) follow a purely prudential perspective, as outlined in our general comments. The planned references to EBA/GL/2025/01 within the POG Guidelines (paragraph 9 in section 2 and Guidelines 2.1a, 8.3 point c, 12.1a) are technically incorrect and should therefore be omitted. Should these references nevertheless be retained, they should refer specifically to the relevant section. The EBA Guidelines mentioned are very extensive and only marginally relate to the topic of greenwashing, which is discussed in detail exclusively in paragraph 76 of section 5.6.4 on operational risks and reputational risks.
Question 2. Do you have any comments on the targeted amendments made to Guidelines 2, 3, 7, 8 and 12?
- In addition to our general comments, it is also worth noting that it is reasonable to anchor ESG and greenwashing risks in the minds of product manufacturers and distributors and to take them into account in product governance arrangements. However, this topic has already been addressed in the EmpCo directive and is also included in the existing POG Guidelines. Against the backdrop of efforts to reduce bureaucracy, it seems questionable as to whether an additional anchoring of this topic in the POG Guidelines is necessary.
- With regard to Guideline2.1a, we believe it is dispensable to introduce a separate obligation for the management board to introduce appropriate processes on the management of risks arising from greenwashing in relation to the products under the scope of the guidelines. The obligation to implement appropriate risk management processes for operational and reputational risks, including greenwashing, can already been derived from other EBA Guidelines.
- For Guideline12.1a (obligations of the distributor), too, there should be no reference to the EBA Guidelines on the management of ESG Risks. This is waived in point c) of Guideline 8.3 (obligations of the manufacturer). The distributor will have to regularly rely on the information provided to it by the manufacturer about the product in accordance with the requirement in Guideline 8.3.
Question 3. Do you have any comments on the consequential changes made to chapter 6 of the POG Guidelines on ‘third-party arrangement’?
Furthermore, it should be noted that the institutions will be granted an implementation period of two years after the planned publication of the final version of the TPRM Guidelines in April 2026. This should be reflected in the application of the revised POG Guidelines.