Compliance Briefing — March 10, 2021

Executive briefing: The Sustainable Finance Disclosure Regulation (Regulation (EU) 2019/2088) entered application on 10 March 2021. Asset managers, insurance-based investment providers, and pension funds must disclose sustainability risk integration, principal adverse impacts (PAIs), and product classifications (Articles 6, 8, and 9) in pre-contractual documents, websites, and periodic reports.

Key compliance checkpoints

Entity-level statements. Publish sustainability risk integration policies and, where relevant, PAI statements covering the 18 mandatory indicators in Annex I.
Product classification. Categorise offerings under Articles 6, 8, or 9 with consistent disclosures on sustainable investment objectives and do-no-significant-harm criteria.
Governance controls. Evidence board oversight, remuneration alignment, and delegated asset manager responsibilities for SFDR disclosures.

Operational priorities

Data sourcing. Contract ESG data providers and build data quality checks to support quantitative PAIs (GHG emissions, biodiversity, social indicators).
Disclosure workflow. Update prospectus templates, KIDs, and website hubs to surface SFDR disclosures and link to taxonomy-alignment reporting.
Record-keeping. Maintain audit trails of methodologies, assumptions, and third-party data used to substantiate Article 8/9 claims.

Enablement moves

Implement disclosure management platforms that support multi-language templates and approval workflows for periodic updates.
Integrate SFDR data into risk and product governance committees so investment decisions align with disclosed objectives.
Train distribution partners on the new classification scheme and client-facing explanations to reduce mis-selling risk.

Sources

Zeph Tech operationalises SFDR by mapping data providers, workflow tooling, and assurance evidence so sustainability claims withstand regulator and investor scrutiny.