ESG regulations: a summary of EU regulations impacting asset managers

The European Commission’s Sustainable Finance Action Plan includes a range of legislative measures which impact asset management firms making available financial products within the EU/to EU investors.

We have prepared a series of notes and blog posts which explain the impact, scope and requirements of the various measures:

Overview of the various measures

The Sustainable Finance Disclosure Regulation (SFDR) imposes sustainability-related disclosure obligations on financial services firms and financial products that have an EU-nexus.

The Taxonomy Regulation amends SFDR and: (i) establishes a taxonomy, or glossary, for assessing whether certain economic activities are considered “environmentally sustainable” in accordance with one or more of six prescribed environmental objectives; and (ii) introduces additional disclosure obligations for products in scope of SFDR. In time, the intention is to extend the taxonomy beyond purely environmentally sustainable objectives to include social objectives.

See our blog post for our thoughts on the applicability of SFDR to UK firms. See also a simple guide to the EC’s clarifications of the SFDR and a Q&A on the implementation of SFDR.

A series of amendments to the existing AIFMD, UCITS and MiFID frameworks, which aim to integrate sustainability considerations into firms’ day-to-day operations. The measures form part of the EU’s sustainable finance action plan.