European Supervisory Authorities Publish Final Report on Disclosures Under the EU Regulation Sustainable Finance Disclosure Regulation

The European Supervisory Authorities (the European Securities and Markets Authority, the European Banking Authority and the European Insurance and Occupational Pensions Authority) have published a final report and draft Regulatory Technical Standards on the content, methodologies and presentation of disclosures under the EU Regulation on sustainability-related disclosures in the financial services sector. The EU SFDR was published in December 2019 and the majority of its provisions will apply from March 10, 2021. It is designed to encourage the financial services sector to disclose information about their approaches to sustainability risk and consideration of adverse sustainability impacts in the course of their businesses. The ESAs consulted on the draft RTS in April 2020. The ESAs propose that the draft RTS should apply from January 1, 2022.

The ESAs' draft RTS cover:
 

• Specifications for reporting on adverse impacts on the climate, other environment-related impacts and social and employee matters; reports should be made by June 30 annually, but the earliest that the information specified in the RTS would be required to be published is 2023, with respect to a reference period relating to 2022;
• The content and presentation of information to be disclosed at the pre-contractual level (e.g., key information documents or fund prospectuses);
• The content and presentation of information to be publicly disclosed on websites by financial market participants; and
• The content and presentation of information to be disclosed in periodic reports for specified products (namely, those which promote environmental or social characteristics, or a combination of those or those which have sustainable investment or a reduction in carbon emissions as their objective).

View the ESAs' report.

View details of the ESAs' consultation on the draft RTS.

View details of the SFDR.

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