ESAs Propose Changes To SFDR Level 2

Having filed updated pre-contractual disclosures to comply with the Level 2 requirements under the Sustainable Finance Disclosure Regulation ("SFDR") at the end of 2022, there was no time for fund managers to rest on their laurels. Further changes to the mandatory disclosure templates to include disclosures on EU Taxonomy-aligned investments in fossil gas and nuclear energy were published in February, followed by the European Supervisory Authorities ("ESAs") consultation paper proposing further Level 2 changes in April.

The ESAs' consultation is based on a mandate given to the ESAs by the European Commission ("Commission") on 28 April 2022 to review and revise the SFDR RTS, but the ESAs' proposals go beyond the terms of that mandate. (The review of the SFDR RTS is to be distinguished from the broader review of SFDR Level 1 announced by the Commission early in 2023.) The consultation addresses proposed amendments to the regulatory technical standards ("RTS") on