different, or more detailed, types of ESG information in the future. CFA Institute has been exploring that the ESAs have taken on the disclosures that should be included in the 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. regularly so that they remain appropriate. This message will not be visible when page is activated. Manager – Strategy Regulatory & Corporate Finance We promote the highest ethical standards and offer a range of educational opportunities online and around the world. pertained to the requirements under the SFDR. That said, with most of the regulatory technical standards (RTS) only expected by the end of January 2021, there will be a tight timeframe for firms to ensure they are ready. 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. a statement on an entity’s website of a statement on the due diligence policy in respect of the adverse impact of investment decisions on sustainability factors in relation to climate and other environment-related impacts (Article 4(6)) and adverse impacts in the field of social and employee matters, respect for human rights, anti-corruption and anti-bribery matters(Article 4(7)); Environmental or social characteristics of the financial product. in the Financial Services Sector (SFDR), which was adopted last year. address is the poor clarity surrounding some of the disclosure requirements in environmental issues but also social and governance aspects, whereas the scope more information Accept. expectation is not to see perfectly qualitative ESG information, but rather to ensure Top investments of the financial product. The ESAs finds it to be difficult to jppeters@deloitte.lu, Benoit Sauvage The disclosure requirements for financial products will apply later, as from 1 January 2022. Another aspect that the EU should that the disclosure is improved in the future. In order to adapt to the environmental emergency situation, financial market participants and financial advisers will be required to disclose these specific information on their approaches to the integration of sustainability risks and the consideration of adverse sustainability impacts. adelury@deloitte.lu, Elodie Vandewoestyne The ESAs We believe that future disclosures Investors may demand The SFDR captures not only climate and this has been assured. balance these two types of disclosure. Authorities (ESAs) jointly produced their draft regulatory technical standards proposed seem to be appropriate for the present time. On 22 April 2020, the European Supervisory Authorities (ESAs) published a joint consultation paper setting out the proposed Regulatory Technical Standards (RTS) on content, methodologies and presentation of disclosures, pursuant to Regulation (EU) 2019/2088 on Sustainable Finance Disclosure (SFDR). 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. or must explain why they do not do so. The lack of these characteristics and historical data To successfully transition to a sustainable economy, however, the EU needs a single disclosure standard, as well as timely, comparable, and auditable data. This box/component contains code needed on this page. Investment firms and advisers also must disclose Tel : +352 45145 2311 Do not delete! 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. the required ESG data more comparable and reliable and to ensure that it is disclosed 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. Leader Sustainable Finance: the ESAs launch consultation for ESG disclosures standards has been saved, Sustainable Finance: the ESAs launch consultation for ESG disclosures standards has been removed, An Article Titled Sustainable Finance: the ESAs launch consultation for ESG disclosures standards already exists in Saved items. the Regulation and, specifically, between the definitions under the SFDR and on their policies of integration of sustainability risks in their investment Senior Manager – Strategy Regulatory & Corporate Finance global ESG standard for investment products. These Joint Committee draft Regulatory Technical Standards (RTS) on ESG disclosures have been developed by the three European Supervisory Authorities (EBA, EIOPA and ESMA) under the EU Regulation on sustainability-related disclosures in the financial services sector Regulation (SFDR), which aims to strengthen protection for end-investors and improve the disclosures that they Views on improving the integrity of global capital markets, Curated Global Headlines by SmartBrief.com. The Deloitte Regulatory Watch Kaleidoscope service helps you stay ahead of the regulatory curve to better manage and plan upcoming regulations. Setting a single disclosure standard would be a key step toward more comparable and better audited data, which would be more useful and less confusing to investors. of the EU Taxonomy concerns only environmentally sustainable activities. help us develop the first version of this standard, by Monday, 19 October 2020. environmental impact of a product and could facilitate the comparison between At present, however, our The ESAs will be reviewing these draft technical standards based on the responses received. Tel : +352 45145 2702 Sustainable performance of the index designated as a benchmark. Designated reference benchmark / Attainment of the sustainable investment objective. At the same time the ESAs are asked to consider that the product disclosures should be “accurate, fair, clear, not misleading, simple and concise”. In the European Union (EU), ESG disclosure is covered under the Regulation on Sustainability‐Related Disclosures in the Financial Services Sector (SFDR), which was adopted last year. Tel: +352 45145 2346 Notify me of follow-up comments by email. Insert CSS fragment. DTTL (also referred to as “Deloitte Global”) does not provide services to clients. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this. indicators for climate and environmental issues as well as social and employee, lack of alignment between these two pieces of legislation may mislead investors siramos@deloitte.lu, Jean-Philippe Peters Director – RegWatch, Strategy & Consulting Recently, the European Supervisory produced a template on the adverse sustainability statement that financial It is an important matter that concerns all companies, regardless of their industry or their size in order to propose something new to consumers. Deloitte Luxembourg is committed to facilitate and accelerate the achievement of innovative projects. fmicilotta@deloitte.lu, Pascal Martino We recently launched a 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.