Europe is in the epicentre of sustainable investment which continues to grow apace with an estimated 45% of the total AuM managed in Europe (totalling 10.7 trillion EUR) now being managed responsibly.1 This enormous growth in sustainable investing has taken place against a backdrop of heightened public attention to environmental and social issues post-COVID and policy development in climate change and sustainability.
And while the EU is currently a leader when it comes to developing its sustainability regulatory framework under its Sustainable Finance Action Plan ― including the newly launched Sustainable Finance Disclosures Regulation (SFDR) ― globally, other jurisdictions are not far behind, and we are seeing a number of international initiatives underway designed to foster convergence and global consistency.
We believe it’s only by looking broadly at the agenda that one can take a strategic approach in the shift towards sustainability. Below you will find a number of pieces, written by our teams of ESG and policy experts, to help you navigate this fast moving and complex space, including:
We continue to stay abreast of these developments and provide educational and timely updates to our audiences. Please bookmark this page and check back regularly for updates.
How SFDR will embed ESG risks across firms and products
The recently launched Sustainable Finance Disclosures Regulation (SFDR) mandates that all asset managers, insurance companies, pensions funds and financial advisers (“firms”) must disclose how they consider sustainability risks, that is, financially material ESG risks, in their investment decision making or advice.
What is the “principal adverse impact” in SFDR?
One of the more novel elements of the Sustainable Finance Disclosures Regulation (SFDR) is the introduction of the concept of “principal adverse impact”.
How SFDR is enhancing ESG product transparency
The Sustainable Finance Disclosures Regulation (SFDR) will mandate enhanced transparency for ESG products as well as introduce a differentiation between broad ESG products and impact products.
The role of the EU taxonomy in combatting “greenwashing”
Combating “greenwashing” is a central pre-occupation of the European Commission alongside channelling investments into sustainable and green investments.
How are other countries developing their ESG regulatory frameworks?
While the EU is currently a leader when it comes to developing its sustainability regulatory framework, other jurisdictions are not far behind.
Four areas of focus: how is your firm responding to the ESG regulation challenge?
The incoming regulations will accelerate the paradigm shift towards sustainability that is already underway in the investment industry.
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1 According to the European Fund and Asset Management Association.
The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.
Data as of 31 January 2021 unless stated otherwise.
This document is marketing material and is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell securities.
Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals, they are subject to change without notice and are not to be construed as investment advice.
