By Jasper Koch Director client services
CSC Global Financial Markets


Toska Pieters Compliance officer
CSC Global Financial Markets

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The Sustainable Finance Disclosure Regulations (SFDR) is due to be implemented 10 March 2021, the first in a series of regulations written by the European Union. In this blog, we’ll share what we know so far, important dates, and funds that will be impacted.

What is SFDR and who is impacted?

Under SFDR, “financial market participants” (participants), defined as firms including asset managers, pension funds, and banks, will need to disclose their approach to sustainability risks. The measures are being introduced to reduce the risk of “greenwashing,” where firms market products as sustainable, without appropriately integrating Environmental Social and Governance (ESG) factors into their investment decision-making process.

Disclosure obligations will apply at company level, where it will be mandatory for firms to disclose sustainability information (“green data”), and at fund or product level. While participants need to be prepared for the new regulations, there are still discussions ongoing over parts of the definition of “green data,” meaning there is some ambiguity surrounding what exactly is required.

Will all fund managers be in scope?

AIFM-licensed fund managers are in scope and will need to comply, however AIFM-registered (or AIFM-light) fund managers are not thought to be impacted (although this exception is still open to debate). The AFM is also hesitant about the scope for AIFM-registered fund managers and has asked the European Commission to clarify.

Our expectation is that ESG- or impact-focused light fund managers will opt to comply with SFDR because of their focus on sustainability.

What are the key dates?

SFDR Level 1 is due to be implemented from 10 March 2021, with a number of more detailed “Level 2” regulations coming into place beginning 1 January 2022.

In the first phase, all in-scope financial products will be required to disclose information on whether and how they consider the sustainability risks associated with their investment practices and processes. There will be a bedding-in period, as the regulation unfolds. In the Netherlands, the AFM has announced that 2021 will be seen as a transition year, and fund managers will be given time to become compliant with the requirements of the SFDR. That being said, our advice is that if your fund is “in-scope,” you should plan to implement SFDR from the 10 March deadline.

Experience matters

At CSC Netherlands, we’ve been actively participating in industry-wide discussions and are part of a broad network, working to ensure SFDR is implemented appropriately here.

To learn more about the new regulations, contact Jasper.Koch@cscgfm.com or visit us at cscgfm.com. We’re informed and happy to assist with your questions.

Are You Ready for the SFDR Deadline? We Are