SFDR: Just How Sustainable Are Article 9 Funds?

Regulatory Compliance November 3, 2022 Patricia Pina, Thomas Willman, Renato Coelho, Lucía Vega-Penichet, Elena Armas

Sustainable Investment

European regulatory authorities are leading the global transition to a more sustainable economy through multiple linked regulatory initiatives. Whether it’s the NFRD, the EU Taxonomy, the SFDR, or the new MiFID II, they all seek to manage capital flows toward sustainable investments. But are these regulations succeeding? Is greenwashing a thing of the past or are financial market participants still at risk of falling short of their sustainability-related claims?

Clarity AI’s research team has analyzed 15,000 funds, then focusing on 750 Article 9 funds to understand to what extent they can really be considered “sustainable investments,” as defined by the regulation itself.

Download the whitepaper to learn:

Clarity AI’s definition of “sustainable investment,” aligned with SFDR

How the Principal Adverse Impact indicators (PAIs) and the Do No Significant Harm principle can help demonstrate that an investment qualifies as a sustainable investment

How an AI-powered model for controversies can effectively capture violations that asset managers might overlook

“The classification of funds according to the SFDR guidelines is increasingly used in the markets as a shorthand for communicating that a product is sustainable. However, our analysis shows that some of the Article 9 funds currently in the market might be falling short of complying with the sustainability-related criteria.”
Patricia Pina, Head of Product Research and Innovation at Clarity AI

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