The FCA and The City of London Corporation are running an ESG Digital Sandbox pilot to support the development of new products and services in the area of environmental, social and governance (ESG) data and disclosure.

Participants will have access to:

  • Synthetic data assets to enable testing, training and validation of prototype technology solutions, for example transactional banking data sets, SME lending data and customer accounts.
  • A collaboration platform to facilitate an ecosystem of key organisations that will provide support and input to digital sandbox participants, such as incumbents, academia, government bodies, venture capital and charities.
  • An application programming interface (API) marketplace where digital service providers list and provide access to services via APIs.
  • An integrated development environment in which applicants can develop and test their solution.
  • An observation deck to enable regulators and other interested parties to observe in-flight testing at a technical level and inform policy thinking in a safeguarded environment.

The purpose of this ESG Digital Sandbox is to accelerate innovation and to address the specific market challenges set out below:

  • How can technology enable transparency in disclosure and reporting on sustainability, especially on corporate assets and supply chains?
  • How can technology be used to automate the assurance of a listed issuer’s ESG data and validation of its ESG-labelled corporate bond issuance?
  • How can technology help consumers understand the ESG characteristics of the products and providers they engage with, as well as provide visibility around alternatives?

The application window will open on 6 September 2021 with the ESG Digital Sandbox opening to successful participants in November 2021 and access to the testing environment being available from January 2022. Applications must be submitted through the online application form on the ESG Digital Sandbox  website, which can be accessed here: https://www.digitalsandboxpilot.co.uk.

FSREG has already registered to be part of the ESG Digital Sandbox community and can provide legal, tax and regulatory assistance to applicants throughout the application and participation process. It can also introduce participants to ESG venture capital investors.

Disclaimer:  This article provides general information only.  It is not comprehensive and does not constitute the provision of legal, tax, investment, regulatory  or other advice.  FSREG is not responsible for any action taken or omitted to be taken on the basis of the information contained in this article.  © 2021 FS REG Limited (www.fsreg.com).  All rights reserved.