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ESA’s final draft of Regulatory Technical Standards

04 March 2021

The EU issued the final draft of the Regulatory Technical Standards (RTS) in February 2021 and set out the objective of the disclosure based regime to:

  • Reorient capital flows towards sustainable investment in order to achieve sustainable growth;
  • Facilitate financial transparency and promote comparability of data in a manner that will enable investors to have a better understanding of investments to remove information asymmetries which can arise where investors are reliant upon, and dependent upon, the integrity of data provided by financial institutions;
  • Assess and manage relevant financial risks stemming from climate change, resource depletion, environmental degradation and social issues.

The draft RTS contains templates for pre-contractual and periodic product disclosures including:

 

Details of the presentation and content of the information in relation to the principle of ‘do not significantly harm’

Article 2(17) SFDR

Statement on entity websites of describing its due diligence policy in respect of the adverse impact of investment decisions on sustainability factors in relation to climate and other environment-related impacts, adverse impacts in the field of social and employee matters, respect for human rights, anti-corruption and bribery matters

Article 4 SFDR

Pre-contractual information for products with E & S characteristics to meet those characteristics

Article 8 SFDR

Pre-contractual information for products with a sustainable objective and how they meet the sustainable objective

Article 9 SFDR

Information on an entity’s website to describe the environmental or social characteristics or sustainable investment of a financial product

Article 10 SFDR

Information in periodic reports

Article 11 SFDR

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  • Reorient capital flows towards sustainable investment in order to achieve sustainable growth;
  • Facilitate financial transparency and promote comparability of data in a manner that will enable investors to have a better understanding of investments to remove information asymmetries which can arise where investors are reliant upon, and dependent upon, the integrity of data provided by financial institutions;
  • Assess and manage relevant financial risks stemming from climate change, resource depletion, environmental degradation and social issues.

The draft RTS contains templates for pre-contractual and periodic product disclosures including:

 

Details of the presentation and content of the information in relation to the principle of ‘do not significantly harm’

Article 2(17) SFDR

Statement on entity websites of describing its due diligence policy in respect of the adverse impact of investment decisions on sustainability factors in relation to climate and other environment-related impacts, adverse impacts in the field of social and employee matters, respect for human rights, anti-corruption and bribery matters

Article 4 SFDR

Pre-contractual information for products with E & S characteristics to meet those characteristics

Article 8 SFDR

Pre-contractual information for products with a sustainable objective and how they meet the sustainable objective

Article 9 SFDR

Information on an entity’s website to describe the environmental or social characteristics or sustainable investment of a financial product

Article 10 SFDR

Information in periodic reports

Article 11 SFDR

Keep up to date with the latest updates

We encourage you to subscribe to our Regulatory Updates to keep up to date with global regulatory changes affecting your business.

Contact us now to learn more about what we can offer you.

 

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