Impact Tip: SFDR

In this Impact Tip, we cover the Sustainable Finance Disclosure Regulation (SFDR).

Established by the European Commission in March 2021, this regulation was introduced to prevent greenwashing and increase transparency around the sustainability reporting of companies and investors. Specific disclosure rules were thus aimed at making the sustainability profile of the funds more comparable and better understood by end investors.

To achieve its objectives, the SFDR has classified funds into 3 categories:

Article 6: Funds without a sustainability objective
Article 8: Funds that promote environmental or social characteristics
Article 9: Funds that have sustainable investment as their objective

SFDR also introduces the concept of Principal Adverse Impacts (PAIs), which are indicators covering environmental, social and governance issues that companies and portfolio managers are required to disclose. The PAIs can be classified as mandatory or optional and are common to all industries.

Watch and hear what our Senior Analyst, Virginie Laplante, has to say on the subject and how impak can help investors determine what constitutes a sustainable investment.

Impact Tip #6

Duration: 2m54