Last Friday, the European Commission published its long-awaited responses to questions previously posed by the European Supervisory Authorities on the Disclosure Regulation SFDR – in particular in relation to the test of “sustainable investments” and the compliance requirements of Article 9( 3) ) for Funds that track Paris Aligned Benchmarks (“PABs”) / Climate Transition Benchmarks (“CTBs”). Philippe Zaouati, CEO of Mirova, a subsidiary of Natixis Investment Managers specializing in sustainable investments, welcomes the EU Commission’s decision against a stricter definition of sustainable investments and for adhering to the SFDR approach as a transparency regulation by which the actors themselves finance take responsibility for:
“A stricter definition would mean that almost all existing Article 9 funds would have been downgraded. The result would have been a huge magma of undifferentiated Article 8 funds. Not a win for sustainable investing, but for players who aren’t taking the issue seriously and would have benefited from the missing categories. Upholding the vision of transparency gives financial actors clear accountability. You have to classify yourself, explain your goals and measures. The media and NGOs have the tools to compare and judge. Contrary to many comments, in my view this is not a greenwashing victory. Because we already have the tools to know what is sustainable: the EU taxonomy, reporting standards, new accounting standards and, most importantly, the science. It is now up to us financial agents to assume our responsibilities. By refusing to turn sustainable finance into a micro niche, the European Commission is forcing all financial actors to assume their responsibilities. No one will be able to say that they are departing from Article 9 because the rules are too restrictive!”
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