Last week, on 10 October, the European Commission hosted the first of a series of online workshops and roundtables with stakeholders as part of its consultation on the SFDR (which we covered here).
In the opening speech to the workshop, European Commissioner Mairead McGuinness, highlighted several key themes as part of the Commission's wider exercise of wanting to develop a "full picture" of how the SFDR is working in practice. This includes understanding whether the SFDR has changed how investors behave, or how asset managers or financial advisors suggest products as well as how the SFDR is interacting with other parts of the sustainable finance legislative framework.
Ms McGuinness also highlighted the Commission's concerns in how the SFDR is not being used in the way it was designed (with regards to its use as a labelling rather than transparency regime) and how the lack of binding thresholds and strict definitions for key concepts (such as the Article 8 product criteria and definition of "sustainable investment") can lead to uncertainty for investors and wider risk of greenwashing and mis-selling.
The online workshop reflects that the Commission appears to be at a fact-gathering stage and that its review of the SFDR will be an extensive and wide ranging exercise involving a number of stakeholders. The Commissioner's acknowledgement that adjustments may need to be made to the SFDR will do little to dispel the expectation of a future overhaul of the legislation.
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