Can the PAI indicators listed in the Annex 1, Table 1 Delegated Regulation be used as indicators to measure the attainment of environmental or social characteristics? See paragraphs 5-7 of the clarifi

Can the PAI indicators listed in the Annex 1, Table 1 Delegated Regulation be used as indicators to measure the attainment of environmental or social characteristics? See paragraphs 5-7 of the clarifications document: 5. “The reference to sustainability indicators in the disclosures for financial products is to be understood with reference to the “sustainability indicators used to measure the environmental or social characteristics or the overall sustainable impact of the financial product” in Articles 10(1)(b), 11(1)(a) and 11(1)(b) SFDR. Therefore, the ESAs consider that the “sustainability indicators” and the indicators for principal adverse impact referred to in Article 4 SFDR, and Chapter II and Annex I of the draft RTS in the ESAs’ final reports refer to different disclosures under the SFDR. 6. However, it is possible to use the indicators for principal adverse impact to measure the environmental or social characteristics or the overall sustainable impact of the financial product, e.g. by showing improvements of the investments against those indicators over time. 7. For the sake of clarity, the ESAs consider the following table with regards to three possible uses of the adverse impact indicators at financial product level: Use of the PAI indicators Related main disclosure sections a) Disclosure of DNSH for sustainable investments under Article 2(17) SFDR: the use of PAI indicators is mandatory to demonstrate that an investment qualifies as a sustainable investment. The PAI indicators to be used are the ones in Table 1 of Annex 1 and any relevant indicators in Tables 2 and 3 of Annex I The ESAs consider that using PAI indicators to fulfil the DNSH of SFDR does not require any PAI consideration Annex II/IV: “how do/did the sustainable investments that the financial product partially intends to make/made, not cause significant harm to any environmental or social sustainable investment objective?” Annex III/V: “how do/did sustainable investments not cause significant harm to any environmental or social sustainable investment objective?” at entity level pursuant to Article 4(1)(a), 4(3) or 4(4) SFDR. b) Disclosure of PAI consideration under Article 7 SFDR: the disclosure of PAI consideration at product level is set out in Article 7 SFDR and is not further specified except for fields in the templates to provide the information required by that Article. Annex II and III: “does this financial product consider PAI on sustainability factors?” Annex IV and V: “how did the financial product consider PAI on sustainability factors?” c) Measurement of the attainment of environmental or social characteristics and the sustainability- related impact (Articles 10(1)(b), 11(1)(a) and 11(1)(b) SFDR): sustainability indicators used to measure the attainment of the environmental or social characteristics (for Article 8 SFDR financial products) or sustainable investment objective (e.g. the impact of the financial product for Article 9 SFDR products) may include PAI indicators. There is no direct link between sustainability indicators and PAI indicators. The ESAs clarify that the use of PAI indicators as sustainability indicators to measure the attainment of environmental or social characteristics or impact of the sustainable investments does not require any prior PAI consideration at entity level pursuant to Article 4 SFDR or PAI consideration at product level pursuant to Article 7 SFDR. Annex II: “what sustainability indicators are used to measure the attainment of each of the environmental or social characteristics promoted by this financial product?” // “What are (…) and how does the sustainable investment contribute to such objectives?” Annex III: “what sustainability indicators are used to measure the attainment of each of the sustainable investment objective of this financial product?” Annex IV: “How did sustainability indicators perform?” // “What were (…) and how did the sustainable investment contribute to such objectives?” Annex V: “How did sustainability indicators perform?