EU Financial Regulatory Q&A Database

When an FMP considers PAI at entity level and discloses a statement on its due diligence policies in accordance with Article 4(1)(a) or 4(3)-(4) of the SFDR, what is required under the description of

SFDR

Regarding 'COMMISSION DELEGATED REGULATION (EU) 2022/1288 of 6 April 2022' (supplementing Regulation (EU) 2019/2088). In Table 2, Annex I of the document, under the section 'Indicators applicable to i

SFDR

PAI 6 (Table 2): The term ‘water usage’ is not defined in the RTS and is not a common term within the CDP nomenclature (water withdrawal, water discharge, water consumption and water recycled/reused).

SFDR

Can a financial product disclosing under Article 9 SFDR, or a financial product disclosing under Article 8 SFDR partly making sustainable investments, disclose in its pre- contractual disclosure that

SFDR

Should financial products calculate top investments or shares of investments in their periodic disclosures under Chapter V and Annexes IV and V of the SFDR Delegated Regulation in a specific way over

SFDR

Should a fund invest in for example cars or real estate assets, through special purposes vehicles ("SPVs") or holding companies, would those SPVs/holding companies be considered as the "companies" cov

SFDR

Should PAI indicator 4 in Table 1, Annex I of the SFDR Delegated Regulation ("Exposure to companies active in the fossil fuel sector") be calculated on a look-through (i.e. share of fossil fuel activi

SFDR

Should PAI indicator 6 in Table 1 of Annex I of the SFDR Delegated Regulation ("Energy consumption intensity per high impact climate sector") be disclosed on an aggregated basis (i.e. each high impact

SFDR

How should values in currencies other than EUR be converted to EUR? E.g. at the point of reporting, the point of the impact or an average value in EUR of values in currencies converted to EUR at diffe

SFDR

With regard to how a financial market participant (e.g. a UCITS management company) discloses PAI indicator 1 in Table 1 of Annex I of the SFDR Delegated Regulation in relation to its financial produc

SFDR

Can a financial market participant rely on disclosures under Article 6(1) second sub- paragraph of the SFDR (which allow financial market participants to disclose in pre- contractual disclosures that

SFDR

Following the answer to Q&A V.9, where financial products are passively tracking Paris Aligned Benchmarks (PABs) and Climate Transition Benchmarks (CTBs), it can be considered they do not fall under A

SFDR

For financial products falling under Article 8 or 9 SFDR, where the financial market participant making available those products is a registered AIFM which has not set up a website, must that register

SFDR

What information should financial market participants disclose about financial products passively tracking a PAB or CTB?

SFDR

In line with SFDR Delegated Regulation and the SFDR Q&As (JC 2023 18), a UCITS management company disclosing its UCITS under Article 9 SFDR may next to "sustainable investments" (i.e. in the "remainin

SFDR

a) In situations where financial market participants delegate management, is the application of the definition of "sustainable investment" in Article 2, point (17) SFDR an exclusive prerogative of the

SFDR

I am trying to figure out how exactly to calculate the share of sustainable investment that qualify as environmentally sustainable under the EU Taxonomy (SDFR Template, Annex II, first question). Let'

SFDR

Are financial market participants obliged to publish the pre-contractual or periodic product templates on their websites based on the SFDR, or does that depend on the sectoral law on publication of th

SFDR

Can a sustainable investment pursuant to Article 2(17) SFDR also be made by investing in another financial product, e.g. a UCITS fund?

SFDR

Given the Commission’s interpretative Q&A II.1 notes that sustainable investments can be measured at economic activity and at the investment level, how can financial products do this in practice? The

SFDR

Can financial products with a passive investment strategy which designate as a reference benchmark either a Paris Aligned Benchmark or (from 1 January 2023) a Climate Transition Benchmark automaticall

SFDR

Article 9(3) SFDR, carbon emissions reductions and other benchmark questions: From Article 9(3) SFDR and the Commissions Q&A answer regarding that Article in July 2021 (which outlined the principle th

SFDR

500 employee principal adverse impact (PAI) threshold: For the purposes of Articles 4(3)- 4(4) SFDR, should “the average number of 500 employees” be understood to include workers who are assigned to t

SFDR

PAI consideration: What is the meaning of “consider” in Article 7(1), point (a), SFDR? Could “consideration” of principal adverse impacts by a financial product mean that a financial product only disc

SFDR

How does the definition of “sustainable investment” in Article 2, point (17) SFDR apply to investments in funding instruments that do not specify the use of proceeds, such as the general equity or deb

SFDR

Can a financial product “promote” carbon emissions reduction as an “environmental characteristic”, as opposed to having it as an “objective”? In other words, can a financial product disclose carbon em

SFDR

Periodic disclosure frequency for portfolio management services: The frequency of periodic reports in case of portfolio management services is determined by Article 11(2), point (i) SFDR, which refers

SFDR

If a financial market participant with more than 500 employees does not market or make available any financial products as defined in Article 2(12) SFDR, does the financial market participant still ha

SFDR

Should the “information about the policies on the integration of sustainability risks in the investment decision-making process” of the financial market participant be restricted to investments affect

SFDR

When it comes to entity-level disclosures in Article 4 should those disclosures relate only to financial products in scope of SFDR, or should those disclosures also relate to other types of instrument

SFDR

How can a financial product disclosing under Article 8 SFDR assess that good governance is effectively considered? Is a reference to the UN Global compact sufficient or should there be an alignment wi

SFDR

Can FMPs remove sections in the precontractual and periodic disclosure templates provided in Annex II to Annex V of the Delegated Regulation that are not deemed relevant for their financial product?

SFDR

For the purposes of completing its disclosures in the Delegated Regulation, is there a difference in how a financial product tracking a Climate Transition Benchmark (CTB) index according to the BMR sh

SFDR

Example on how to calculate the value on an Indicator where an FMP has 2 Financial Products (FP) with 2 investments (Inv) each.

SFDR

How should "all investments" be understood? Gross asset value including cash, other assets, other liabilities? Or only actual investments, e.g., only private equity / private debt assets?

SFDR

Would it be possible to have a financial product disclosing under Article 8 SFDR that makes sustainable investments with environmental objectives which are not (yet) taxonomy aligned?

SFDR

The question relates to the separation of asset class in Annex I, Table 1, indicator 4 (Exposure to companies active in the fossil fuel sector) and 17 (Exposure to fossil fuels through real estate ass

SFDR

In Annex I, Table 2, indicator 18 (GHG emissions), do we take the % of ownership into account when calculating the total GHG emissions (i.e. should GHG emissions be calculated as sum of all GHG emissi

SFDR

Annex I, Table I, indicator 13 (board gender diversity). Assume a company has 5 female board members and no male board members. The indicator is defined as follows: Average ratio of female to male boa

SFDR

How do you calculate indicator 8 (Emissions to water) from Table 1 (and similar indicators) where the explicit formula is not provided?

SFDR

Is it possible to comply with Article 6 SFDR by just saying that sustainability risks are not being integrated and not taken into account yet, or does Article 6 SFDR mean that sustainability risks sho

SFDR

Would a discretionary mandate that invests according to Investment Guidelines stipulated by the client be regarded as a financial product falling under Article 8 or Article 9 SFDR?

SFDR

Are financial market participants allowed to define their own substantial contribution criteria for socially sustainable investments? Can a single financial market participant apply different interpre

SFDR

Article 9(3) SFDR sets out disclosure requirements for “a financial product, [which] has a reduction of carbon emissions as its objective”. Does this also apply if a financial product has “reduction o

SFDR

Can the objective-aligned index designated as a reference benchmark under Article 9(1) SFDR, i.e. the “designated index” referred to in 9(1)(a) or 9(1)(b), be a broad market index?

SFDR

If a financial market participant has to report on the consideration of ESG factors due to legally required information duties, such as under Directive (EU) 2016/2341, does this already qualify as "pr

SFDR

Calculation of Indicators 1 and 2 table 1 - Enterprise Value Question: For those indicators where Enterprise Value is used, how should we proceed if the Enterprise Value is negative?

SFDR

Should an FMP still disclose the indicators applicable to investments in “sovereigns and supranationals” and “real estate assets” if the FMP makes no investments in sovereigns, supranationals and real

SFDR

What does “current value” mean?

SFDR

Do the ESAs have a view on how to incorporate short positions within the PAI indicators – should they be excluded, by being deducted from the PAI indicator calculations where the shorts relate to a br

SFDR