ESAs publish updated joint supervisor statement on the application of SFDR

02/05/2022

On 24 March 2022, the European Supervisory Authorities (EBA, EIOPA and ESMA – ESAs) published an updated joint supervisory statement on the application of the Sustainable Finance Disclosure Regulation (SFDR).

The ESAs recommend that national competent authorities and market participants use the current interim period from 10 March 2021 until 1 January 2023 to prepare for the application of the forthcoming Commission Delegated Regulation containing the Regulatory Technical Standards (RTS) while also applying the relevant measures of SFDR and the Taxonomy Regulation according to the relevant application dates outlined in the supervisory statement.

The ESAs clarify that, under Article 5 and 6 of the Taxonomy Regulation, the supervisory expectation for disclosures during the interim period is that financial market participants should provide an explicit quantification, through the numerical disclosure of the percentage, of the extent to which investments underlying the financial product are taxonomy-aligned.

In addition, while estimates should not be used, where information is not readily available from investee companies’ public disclosures, financial market participants may rely on equivalent information on taxonomy-alignment obtained directly from investee companies or from third party providers.

Head of Knowledge Management Strategy and Market Infrastructure - SGSS