SFDR: an important new focus area for the compliance function of asset managers.

1. Introduction

This article is about a new topic which increasingly requires significant attention of the compliance function of asset managers: compliance with new requirements on sustainability disclosures towards clients and investors. Since 10 March 2021, asset managers, such as fund managers, banks, MiFID investment firms, pension funds and insurance companies, are subject to detailed transparency requirements towards clients and investors on the sustainability characteristics of the financial products which they offer. These requirements have their basis in the so-called Sustainable Finance Disclosure Regulation (SFDR).2  The SFDR aims to prevent "greenwashing"3  and increase comparability of financial products as regards their sustainability characteristics. Amongst others, asset managers4 should:

1. label each of their financial products as regards the sustainability ambition of the product (the so-called "articl...

Verder in dit artikel:

1. Introduction

2. Disclosures on the integration of sustainability risks (art. 3, 5 and 6 SFDR)

3. Transparency on principle adverse impact (PAI) (article 4 and 7 SFDR)

3.1. Introduction

3.2. PAI statement at entity level

3.3. Disclosure requirement at product level (Article 7 SFDR)

4. Qualification of a financial product under article 8 and 9 SFDR

4.1. Introduction

4.2. Classification of financial products under Article 8 and 9 SFDR

4.2.1. Article 9 SFDR

4.2.2. Article 8 SFDR

4.3. Disclosure requirement for art. 8 and 9 classified products

5. Concluding remarks