ALFI responds to the ESAs consultation regarding RTS on the Sustainable Finance Disclosure Regulation

In the course of this consultation, ESAs were particularly seeking stakeholders’ feedback on proposals focused on extending the list of universal social indicators for the disclosure of the principal adverse impacts of investment decisions on the environment and society, refining the content of other indicators for adverse impacts, adding product disclosures regarding decarbonisation targets, as well as simplifying pre-contractual and periodic disclosure templates for financial products and making technical adjustments with regards to specific calculation on “do not significantly harm” and principle adverse impact disclosures.

In its response, ALFI outlines that it is of utmost importance to consider the substantial data challenge and align the disclosures requirements with the underlying entities disclosure agenda under CSRD. Meanwhile, ALFI highlighted the concern for clarity and readability of the disclosures, in the best interest of the investors. In particular, ALFI articulated some concerns regarding the timing of some of the ESAs’ proposed amendments in the disclosures in this SFDR Level 2 review, proposing to postpone some RTS elements further to the upcoming Level 1 review, to avoid misalignments and further challenges to the interpretation of SFDR.