(13)Member States neither regulate nor supervise the activities of ESG rating providers or the conditions for the provision of ESG ratings. Given the existing divergences, lack of transparency and absence of common rules, it is likely that Member States would adopt diverging measures and approaches impeding alignment with the objectives of the SDGs and the European Green Deal. Those diverging measures and approaches would have a direct negative impact on, and create obstacles to, the proper functioning of the internal market and be detrimental to the ESG rating market. ESG rating providers issuing ESG ratings for the use of financial institutions and undertakings in the Union would be subject to different rules in different Member States. Divergent standards and market practices would make it difficult to have clarity over the construction of ESG ratings and to compare them, thus creating uneven market conditions for users of ESG ratings. That would cause additional barriers within the internal market and would risk distorting investment decisions.