Nigerian-Led ESG Advisory Firm Joins FCA Sustainability Reporting Pilot

FCA selects UK advisory firm for ESG ratings pilot

The Financial Conduct Authority has chosen ESG Management Services, a London-based advisory firm founded by Lagos-born specialist Toju Francisco Da-Silva, to participate in its regulatory reporting pilot for ESG ratings providers. The selection places ESGMS among the first firms to help shape how the UK will supervise and report on ESG ratings when formal regulation begins in June 2028.

This pilot is voluntary. However, it carries weight. The FCA opened applications in late April 2026 and closed them on 13 May. Firms that registered were told the regulator might select a representative sample. ESGMS made the cut.

The pilot tests whether proposed reporting metrics are clear, practical across different business models, and useful for supervision. It also aims to reduce unnecessary compliance burdens before the regime goes live. For ESGMS, participation offers early insight into regulatory expectations and a chance to influence the framework before it becomes binding.

UK regulation of ESG ratings takes shape

The FCA launched its formal consultation on ESG ratings regulation through policy paper CP25/34 in early 2026. The government had already passed the necessary legislation in December 2025 through a statutory instrument that gave the FCA authority to oversee ESG ratings providers. Consequently, the UK is building one of the first comprehensive national regimes for this sector.

Under the proposed rules, firms providing ESG ratings likely to influence investment decisions will need FCA authorisation. The regime is scheduled to come into force on 29 June 2028. In addition, the FCA expects to finalise its rulebook in the fourth quarter of 2026 after reviewing consultation feedback.

The regulator has said repeatedly that transparency and comparability are problems in the ESG ratings market. Different providers use different methodologies. Therefore, investors often struggle to compare ratings or understand what sits behind them. The FCA wants consistent reporting standards to address this.

For UK businesses, particularly those seeking investment or managing supply chain relationships, this shift matters. ESG ratings increasingly shape capital allocation decisions. Moreover, inconsistent or opaque ratings can create confusion or risk. A regulated market should make ratings more reliable and easier to interpret.

ESGMS brings cross-border perspective to the pilot

ESGMS describes itself as a sustainability, governance, and investment advisory firm. Its LinkedIn profile highlights ESG advisory services, investment readiness support, and the CIREF framework. The firm also promotes ESG upskilling consultancy for small and medium enterprises in emerging African markets.

The company’s founder, Toju Francisco Da-Silva, is a Nigerian-born specialist now based in the UK. This background gives ESGMS a cross-border perspective that may be useful to the FCA as it designs a regime that will interact with international markets and ratings providers operating across jurisdictions.

Participation in the pilot does not confer regulatory approval. Nevertheless, it signals that the FCA is considering input from smaller specialist firms alongside larger established providers. This approach could help ensure the final regime works for different business models, not just the largest players.

For ESGMS, the immediate benefit is reputational. Being named as a pilot participant strengthens the firm’s profile in a market that is about to become far more structured and compliance-focused. Furthermore, it positions the firm as an early mover in a regulated space where credibility will increasingly depend on formal authorisation and regulatory engagement.

Timeline and next steps for the ESG ratings regime

The UK’s path to regulating ESG ratings has moved quickly. The government signed the ESG ratings regulation order into law on 15 December 2025. Subsequently, the FCA opened its consultation in early 2026 and launched the reporting pilot on 28 April. The pilot registration deadline was 13 May 2026.

The FCA is expected to publish final rules in the fourth quarter of 2026. After that, firms will have until 29 June 2028 to prepare for authorisation and compliance. This timeline gives the market roughly two years to adapt.

During this period, firms that provide ESG ratings will need to assess whether they fall within the scope of the regime. Specifically, the rules will apply to firms whose ratings are likely to influence investment decisions. Therefore, businesses that currently provide ESG scores, rankings, or assessments should review the consultation paper and consider whether they will need FCA authorisation.

The pilot itself is ongoing. Participants like ESGMS will submit data and feedback to the FCA based on proposed reporting metrics. The regulator will use this information to refine its approach before finalising the rules. As a result, the pilot is a live opportunity to shape the regime from the inside.

What this means for UK businesses relying on ESG ratings

Many UK companies now find their ESG performance rated by third-party providers. These ratings feed into investment decisions, lending criteria, tender processes, and supply chain assessments. However, the quality and comparability of these ratings have been inconsistent.

Regulation aims to change that. The FCA has stated clearly that it wants to improve transparency and ensure ratings are produced to consistent standards. For businesses, this could mean more reliable assessments and clearer expectations about what drives their scores.

On the other hand, businesses may also face more scrutiny. Ratings providers operating under FCA oversight will be expected to follow robust methodologies and disclose how they arrive at their conclusions. Consequently, companies may need to provide more detailed information to support their ESG claims.

SMEs in particular should pay attention. Smaller firms often lack the resources to engage deeply with ESG ratings, yet they are increasingly asked to demonstrate sustainability credentials by larger customers or public sector buyers. A regulated ratings market should make it easier to understand what is expected and how to respond.

The cross-border dimension also matters. ESGMS works with SMEs in African markets, and the UK regime will interact with international standards and ratings frameworks. Therefore, businesses with global supply chains or international operations may find that UK regulation influences how they are assessed elsewhere.

Key details about the FCA pilot and regime

The following points summarise the most important facts:

• The FCA selected ESGMS to participate in a voluntary regulatory reporting pilot for ESG ratings providers in May 2026.
• The pilot tests proposed reporting metrics for clarity, feasibility, and supervisory usefulness before the regime goes live.
• The UK government legislated for FCA oversight of ESG ratings providers in December 2025, with the regime set to begin on 29 June 2028.
• Firms providing ESG ratings likely to influence investment decisions will need FCA authorisation under the new rules.
• The FCA published its consultation paper, CP25/34, in early 2026 and expects to finalise rules in the fourth quarter of the same year.
• ESGMS is a London-based advisory firm founded by Nigerian-born specialist Toju Francisco Da-Silva, with a focus on ESG advisory and investment readiness.
• The pilot aims to reduce unnecessary compliance burdens and gather feedback from different types of market participants.

How businesses should prepare for regulated ESG ratings

Businesses that rely on ESG ratings, or that provide them, should start preparing now. The regime will not take effect until mid-2028, but the consultation period is active and the pilot is underway. Therefore, this is the time to engage with the process.

First, review the FCA’s consultation paper to understand whether your business falls within scope. If you provide ESG ratings, scores, or assessments that could influence investment decisions, you may need authorisation. Equally, if you use ESG ratings to make procurement or investment choices, you should understand how the new regime will affect the quality and reliability of the ratings you depend on.

Second, consider how you document and disclose your ESG performance. Regulated ratings providers will need to justify their methodologies and conclusions. As a result, businesses that want credible ratings should ensure they can provide clear, verifiable evidence to support their ESG claims. This is particularly important for firms seeking carbon reporting compliance support or preparing for public sector tenders that include sustainability criteria.

Third, monitor the timeline. The FCA will finalise rules in late 2026. After that, firms in scope will have roughly 18 months to secure authorisation and implement necessary systems. Meanwhile, businesses that use ratings should track how providers respond to the new regime and whether their methodologies change.

Fourth, think about skills and capacity. The ESG ratings market is becoming more technical and regulated. Firms may need to invest in training or advisory support to navigate the new requirements. Organisations like SBS Academy offer training on carbon reporting, ESG compliance, and related topics that can help teams build the knowledge they need.

Finally, consider the broader context. The FCA’s move to regulate ESG ratings is part of a wider shift towards greater accountability and transparency in sustainability claims. This includes rules on greenwashing, mandatory climate reporting, and evolving public procurement standards. Therefore, businesses should treat ESG ratings as one part of a larger compliance and credibility framework.

What the ESGMS selection signals about the UK market

The choice of ESGMS as a pilot participant suggests the FCA is serious about testing its proposed regime across different types of firms. ESGMS is not a household name in the way some larger ratings agencies are. However, it brings a specific perspective: a smaller firm with cross-border expertise and a focus on emerging markets.

This matters because the ESG ratings market is not homogenous. Large providers serve institutional investors with global portfolios. Smaller firms often work with SMEs, regional markets, or specific sectors. If the FCA designs a regime that only works for the largest players, it risks creating barriers to entry and reducing competition.

By including firms like ESGMS in the pilot, the regulator can test whether its reporting metrics are proportionate across different business models. Furthermore, it can gather feedback on how the regime will interact with international markets and cross-border advisory work.

For the UK market more broadly, this approach suggests the FCA is trying to build a regime that is credible without being unnecessarily burdensome. The regulator has said explicitly that it wants to avoid imposing compliance costs that do not serve a clear supervisory purpose. Therefore, the pilot is a mechanism to refine the rules before they become binding.

This is also a signal to businesses. The UK is moving ahead with ESG ratings regulation faster than many other jurisdictions. Firms operating in the UK market, or seeking UK investment, should assume that ESG ratings will become more standardised, more transparent, and more regulated over the next two years. Consequently, businesses should prepare for a market where credibility depends on regulatory compliance, not just self-declaration.

Further information and official sources

The FCA published its consultation paper, CP25/34, which sets out the proposed approach to regulating ESG ratings providers. Businesses can access the full document through the Financial Conduct Authority website. The paper includes detailed proposals on scope, authorisation, and reporting requirements.

The UK government’s statutory instrument that gave the FCA authority to regulate ESG ratings was signed into law on 15 December 2025. The text is available on legislation.gov.uk for firms that want to understand the legal basis for the regime.

ESGMS has published information about its participation in the pilot on its LinkedIn profile. The firm describes its advisory services and focus areas, including investment readiness and ESG upskilling for SMEs in African markets.

For businesses seeking support with ESG compliance and carbon reporting, SBS offers consultancy and training services designed to help UK SMEs navigate evolving sustainability requirements. This includes support for firms preparing for regulatory changes, public sector tenders, and supply chain assessments that include ESG criteria.