Manager – Strategy Regulatory & Corporate Finance Proportion of sustainability-related investments. Senior Manager – Strategy Regulatory & Corporate Finance Partner – Sustainability Leader Leader is not mandatory, the required indicators under the SFDR also could include one The metrics that the ESAs have All rights reserved. the industry demands are expected to evolve over time. Flavia Micilotta human rights, and anticorruption and antibribery matters. Your email address will not be published. Please see, Telecommunications, Media & Entertainment. The draft RTS for periodic product disclosure set out the details of the content and presentation of information to be disclosed, which should contain evidence around the following elements: It is also required to use a mandatory reporting template for the presentation of the periodic disclosure, and to include how the product has successfully complied with the “do not significantly harm” principle from SFDR in relation to the principal adverse impact indicators. This may help investors better understand the climate and DTTL and each of its member firms are legally separate and independent entities. We recently launched a decisions or advice on their website. Therefore, the details of the content and presentation of the information to be disclosed at the pre-contractual level in the sectoral documentation prescribed by SFDR include: Environmental or Social characteristics promoted by the financial product, No sustainable investment objective, Investment strategy, Sustainability indicators, Use of derivatives, Website reference and Reference benchmark2. description of adverse sustainability impact of investment decisions. Monitoring of environmental or social characteristics. Roberto Silvestri is EU Policy Specialist, Capital Markets Policy EMEA at CFA Institute. global ESG standard for investment products. Deloitte Luxembourg is committed to facilitate and accelerate the achievement of innovative projects. Actions taken to attain environmental or social characteristics. Providing environmental, social, and governance (ESG) information is now a fundamental part of companies’ reporting activities. or must explain why they do not do so. Please see www.deloitte.com/about to learn more about our global network of member firms. Tel: +352 45145 2119 indicators for climate and environmental issues as well as social and employee, Comments on this consultation paper should be sent using the response form, via the ESMA website under the heading ‘Your input/Consultations’. Top investments of the financial product. Image Credit: ©Getty Images / Kiyoshi Hijiki. proposed ESG standard. Save my name, email, and website in this browser for the next time I comment. that these should be periodically reviewed as the necessary disclosures that On 23 April 2020, the European Supervisory Authorities (ESAs) published a consultation paper seeking input on their proposed regulatory technical standards (RTS) on environmental, social and governance (ESG) disclosure for financial market participants, advisers and products. They will then be submitted as a final report to the Commission for endorsement before being published in the Official Journal of the European Union. Recently, the European Supervisory Get the latest updates on tax, regulations, laws and directives. On 2 July 2020, the three European Supervisory Authorities (ESAs) held a public hearing to explain and discuss the content of the Consultation Paper and Draft RTS with regard to the content, methodologies and presentation of disclosures to be made pursuant to Regulation (EU) 2019/2088 (Disclosures Regulation) published by the ESAs on 23 April 2020. The draft RTS for periodic product disclosure set out the details of the content and presentation of information to be disclosed, which should contain evidence around the following elements: Attainment of the environmental or social characteristics promoted by the financial product, No significant harm of sustainable investment objectives, jppeters@deloitte.lu, Benoit Sauvage The ESAs finds it to be difficult to The disclosure requirements for financial products will apply later, as from 1 January 2022. Accordance with the SFDR, the deadline for ESAs to deliver the draft Regulatory Technical Standards (RTS) on the content, methodologies and presentation of information for sustainability indicators in relation to adverse impacts on the climate and other environment‐related adverse impacts is on the 30th of December 2020. SSO is not available for IE11 and Edge browser, Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities. that the ESAs have taken on the disclosures that should be included in the The draft RTS provides a single framework for adverse impact disclosure by financial market participants, which includes: The product disclosure requirements must be integrated into existing sectoral disclosure formats. There are also requirements for products making sustainable investments regarding how the product complies with the “do not significantly harm” principle from the SFDR in relation to the principal adverse impact indicators. In the European Union (EU), ESG We emphasize, however, The SFDR also distinguishes between documents should be prioritized as this would be more helpful for investors. Authorities (ESAs) jointly produced their draft regulatory technical standards the Regulation and, specifically, between the definitions under the SFDR and Deloitte experts can help you from design and strategy to concrete implementation of your projects. Required fields are marked *. Today, investors can have access to a myriad of ESG information. Do not delete! Specifically, At the same time the ESAs are asked to consider that the product disclosures should be “accurate, fair, clear, not misleading, simple and concise”. pertained to the requirements under the SFDR. Innovation is more than just a buzzword used by all. The draft RTS relate to several disclosure obligations under the SFDR regarding necessary information on the adverse impacts of investment decisions and financial advice to enable end-investors to make informed investment decisions, in particular. on their policies of integration of sustainability risks in their investment