Easy SFDR Compliance: Generate Your Entity-Level Report in 2 Minutes

The entity-level report reflects how portfolios performed against the Principal Adverse Impact indicators (PAIs)

Since the SFDR Level 2 requirements entered in force in January 2023, financial markets participants are required to submit an annual entity-level PAI report before June 30th. The template, included in Annex 1 of the regulation, shows how the investment universe performs against the Principal Adverse Impact indicators. The reference period for this second report is 2023, and the regulation stipulates that the annual calculations must be made on the basis of four quarterly snapshots. Additionally, firms who reported on PAIs last year need to include 2022 data as well.

In an effort to simplify reporting and reduce manual work, Clarity AI offers a simple tool to download pre-filled template within minutes. Here’s how:

Your SFDR Annex 1 Template, in 2 Minutes

Keeping pace of the regulations and reporting the right data in the right format can be overwhelming. However, technology can significantly reduce this friction. Clarity AI’s technology allows users to select four different investment universes, one per quarter in the reporting year.

They are then able to see how their investments were performing against the PAIs at each point in time. This information helps make better and more informed decisions about the entity’s assets, to build more sustainable portfolios and satisfy the regulatory requirements.

Step 1: Select quarterly portfolios and the optional PAIs

Upload and select the portfolio for each of the quarters in 2023, and include the optional PAIs you would like to report on.

Step 2: Download a pre-filled report in your preferred language

Users can choose between seven languages at the click of a button to meet the local regulators’ expectations. The report is then generated using the official template, and pre-filled with all quantitative data.

Step 3 (if applicable): Choose how to include historical data

Firms who reported on PAIs in 2023 (based on fiscal year 2022), need to include that data in this year’s report. Clarity AI allows users to download the data from the previous exercise to input the data in the entity-level reports.

Clarity AI’s SFDR solutions have been built from the ground up to exactly match the expectations of the authorities, with whom we regularly engage to make sure our methodology reflects the latest regulatory developments.

Contact us to explore the various ways clients are using our SFDR solutions and request a demo to learn how Clarity AI can support your organization.

This blog post was originally published on February 13, 2023, and was updated on May 21, 2024.