BETTER FINANCE welcomes the European Commission’s proposal to revise the SFDR and the move towards a clearer product categorisation framework. This is an important and necessary step towards improving legal certainty, limiting greenwashing, and helping retail investors better understand the sustainability profile of financial products. At the same time, the success of the revised framework will depend on whether it delivers genuinely clear, credible and decision-useful information for end investors.
The revision of the SFDR should ultimately strengthen the credibility of sustainable finance in Europe and rebuild trust among individual investors. To achieve this objective, the framework should ensure that sustainability claims correspond to genuine investment practices and measurable outcomes. Mandatory engagement for transition products, stronger and more comprehensive ESG metrics, and short, clear and standardised disclosures - including pre-contractual templates limited to a maximum of two pages - are key elements to achieving this goal.
BETTER FINANCE calls on the Commission to prioritise investor protection, ensure strong and comparable sustainability criteria, and maintain clear and accessible disclosures. A framework that combines transparency, credibility and accessibility will not only protect investors but also support the mobilisation of capital towards Europe’s sustainability objectives.
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