On Monday 27 October, Better Finance, the European federation of investors and users of financial services, called on European legislators to undertake “reforms that genuinely strengthen transparency and investor protection”, in particular with regard to the revision of the European ‘SFDR’ regulation on the publication of information relating to sustainable finance.
The federation fears that this revision will result in “weak definitions, optional obligations, or broad categories without meaningful criteria”. If this is the case, it warns that investor confusion and distrust of ‘sustainable’ investment products will persist and the risk of ‘greenwashing’ will increase. The SFDR will then be “unable to channel capital effectively towards a genuine net-zero, sustainable economy”.
Better Finance urged the European Commission and co-legislators to ensure that the review requires “credible, mandatory engagement in transition-labelled products”, “establishes clear terminology and non-overlapping categories” and “keeps retail investor protection at the forefront of reform”. (Original version in French by Anne Damiani)