BVI on the SFDR review

As part of the EU consultation to review the Sustainable Finance Disclosure Regulation (SFDR), we submitted an extensive statement focusing on the following:

• Coroprate-level disclosure requirements in the SFDR should be eliminated as they do not provide added value for investors and will be covered in the future by the general reporting requirements under the EU Corporate Sustainability Reporting Directive (CSRD).
• At the product level, the current transparency logic should be maintained, where specific sustainability reporting obligations apply only to products with ESG-related commitments (Article 8 and Article 9 products). If the Commission persists in proposing standards for sustainability disclosure for all financial products, these should be limited to a few essential indicators, such as greenhouse gas emissions, relevant to all assets and markets.
• We support the EU Commission’s initiative to introduce a classification system for sustainable products. In our view, distinguishing the following product categories would be meaningful:
   
  1. Products aiming to make a measurable contribution to an environmental or social objective,
  2. Products targeting the promotion of sustainable transformation,
  3. Products adhering to credible sustainability standards or investing in sustainability themes.

These product categories should be sufficiently general to work for all asset classes and multi-asset strategies. They should be easily understandable and consider the sustainability needs of retail investors. Therefore, we recommend extensive practical testing in advance.

We have consolidated these key concerns for better comprehension in a separate document. In the coming months, the EU Commission will gather further information from the market, including through stakeholder workshops, to compile a report on the SFDR review based on this input. Specific measures will be decided upon by the EU Commission under the new leadership following the EU elections.