WeeFin’s Post

The UK’s sustainable fund market is on the brink of a transformation with the introduction of the Sustainability Disclosure Requirements (SDR). This game-changing regulation is set to revolutionise how we allocate capital to achieve net-zero goals. 🔍 What is the SDR? The SDR is a comprehensive framework aimed at enhancing transparency and trust in sustainable investments while tackling greenwashing concerns. Similar to the EU's Sustainable Finance Disclosure Regulation, the SDR is the most detailed and forward-thinking regulation the UK has seen. 🏷️ Key Components Anti-Greenwashing Rule: Effective from May 31, 2024, applying to all UK-manufactured or distributed products. Fund Labelling: Starting July 31, 2024, UK companies can use four new sustainability labels: - Sustainability Focus - Sustainability Improvers - Sustainability Impact - Sustainability Mixed Goals 🔧 For Wealth Managers To qualify for a label, products must meet criteria related to: - Sustainability objectives - Investment policies and strategies - Key performance indicators - Resources and Governance - Stewardship ❓ To what extent do you think the SDRs will reshape sustainable investing in the UK and ensure capital is effectively channelled towards a greener future? #SustainableInvesting #ESG #NetZero #Finance #SDR #GreenInvestments Read the full piece 👉 https://lnkd.in/eFzUTUfN

📝 Genesta has responded to the EU Commission's Targeted consultation on the implementation of the #SFDR   Overall, Genesta advocates for the inclusion of transition strategies, redefined sustainability categories, and mandatory third-party verification. Here are some of our key findings:   ➡ Transition strategies: Genesta views transition strategies in the real estate sector as a key enabler to achieve global sustainability targets and decarbonize the building stock, however, existing transition strategies face a negative perception in the SFDR. Examples are the definition of 'energy inefficient real estate assets' and the clarification that sustainable investments need to be sustainable at the time of acquisition, allowing no room for transition. One could argue that financial resources ought to be directed to facilitating the transition of brown buildings to green, as opposed to only incentivising investors to acquire already sustainable properties.   ➡ Sustainability categories: Genesta does not recommend establishing a categorisation system around the existing Articles 8 and 9, as we do not consider the current concepts fit for purpose. If it were to be used, it is important to address the ambiguity surrounding the use of Articles 8 and 9 and its concepts. Clear definitions and minimum thresholds should be established to avoid confusion. Moreover, it needs to be clarified how brown-to-green strategies will be included.   ➡ Assurance: Genesta believes that third-party verification is essential to limit greenwashing and ensure claims on sustainability categories are verified. Therefore, we strongly support third-party assurance over self-declaration.   💡 Read more on our main findings here: https://lnkd.in/dExzSRB9

EU regulations on sustainability transparency, like the Sustainable Finance Disclosure Regulation (SFDR) and the Corporate Sustainability Reporting Directive (CSRD), are promising to mobilise more capital for impact. But the current framework lacks a specific transparency category to highlight the positive impact of investors and companies. And the EU initiative to develop a social taxonomy is unlikely to materialise in the near future. Join us at #BusinessofImpact & #CapitalIdeas to explore different approaches by which EU policy and law can effectively define, report, steer and accelerate investments towards impact: https://lnkd.in/eBAQvqKe with Servane Metzger-Corrigou (Ring Capital), Cyril Gouiffès (European Investment Fund (EIF)) & Jana Bour Ines Mertens de Wilmars Sophie Faujour Nicolas Malmendier Stéphanie Brenda Smialowski Karolina Kolarova

#3 Sustainable Finance Disclosure Regulation (SFDR) Since the EU's SFDR came into force in March 2021, there has been an increasing demand for asset managers to provide more information and visibility on the sustainability risks and impact of their investment products sold in the EU. 💡 Why was it introduced? The regulation aims to create a more transparent playing field, partly to prevent greenwashing – where some financial firms claim that their products are sustainable when they are not. 🔎 Did you know that there are three classifications under the SFDR? 🎯 Article 6 - It includes funds that do not prioritise sustainability in their investment strategy. For example: it may include companies excluded from ESG funds, such as tobacco and thermal coal producers. 🎯 Article 8 (Light Green Funds) - Also known as ‘environmental and socially promoting’, applies “… where a financial product promotes, among other characteristics, environmental or social characteristics, or a combination of those characteristics, provided that the companies in which the investments are made follow good governance practices". For example: BlackRock Sustainable Euro Bond Fund. 🎯 Article 9 (Dark Green Funds) - Also known as ‘products targeting sustainable investments’, covers products targeting bespoke sustainable investments and applies “… where a financial product has sustainable investment as its objective and an index has been designated as a reference benchmark". For example: Allianz Global Investors' Global Sustainable Equity Fund, which aims to generate long-term capital growth while investing in companies that promote sustainability. For more information on SFDR: https://lnkd.in/ep9qp6KF TEAMWILL #sfdr #corporatesustainability #esginvesting

Designed to be a heads up on how the new SDR rules may develop and shape the sustainable finance ecosystem, particularly adviser processes and decision making. Quite a lot to fit in to the time available but I am sure any questions can be posed before, during or afterwards.

Lisa Beauvilain Global Head of Sustainability and Stewardship, spoke at BloombergNEF last week on sustainable finance policy. Lisa discussed how compliance rules are impacting firms’ competitiveness and how these approaches are impacting investment in the energy transition. For more information on the challenges and opportunities arising from the transition to a more sustainable economy, visit >> https://lnkd.in/eJFvdA3Y #BNEFSummit

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While the introduction of a sustainable finance regulatory framework has been a significant step forward in support of the objectives of the European Green Deal, in view of the critical targets at hand, it is imperative to take stock of the extent to which capital flows are indeed being redirected towards sustainable investments. To this end, on 4 April 2024, the EU Platform on Sustainable Finance published a progress report on monitoring capital flows to sustainable investments.   Read more: https://lnkd.in/dRxT8N2v #sustainablefinance #sustainableinvestments #esg Louisa Firman Malcolm Falzon

The Canadian Sustainability Standards Board (CSSB) released its proposed Canadian Sustainability Disclosure Standards (CSDS), which is open for comment until June 10, 2024. Committed to the global baseline established by the International Sustainability Standards Board (ISSB), the proposed Canadian standards aim to set a new benchmark for the disclosure of sustainability-related information, facilitating a more consistent and comparable approach. Join Adelaide Chiu and Nora Wood from CSSB and moderator Catherine Isabelle from PSP Investments to find out more about the proposed disclosure standards, what the consultation entails, and what this might mean for your organization. Click here to register (members only): Webinars - PIAC | Pension Investment Association of Canada (piacweb.org) #PIACPensions #SustainabilityDisclosure #ESG #ESGStandards #CorporateTransparency #ESGCompliance #ESGReporting

https://bit.ly/4fhmaIS 🌍 🏷 In an effort to crack down on false claims of so-called “green funds” and sustainable investments with no basis for such a claim, the FCA is introducing measures to combat the use of these terms. In this article, Alexandra Heron and Eva Wichtowski delve into Sustainability Disclosure Requirements and the new investment labels regime. Read the full article via the link above. ☝ #SDR #SustainabilityDisclosureRequirements #InvestmentLabels #ESG #FCA