The EU Sustainable Finance Disclosure Regulation and its impact

The EU Sustainable Finance Disclosure Regulation and its impact
The EU Sustainable Finance Disclosure Regulation and its impact
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  • European Union Sustainable Finance Disclosure Regulation came into force on March, 10
  • The goal is to create more transparency for sustainability risks in financial investment products
  • Austrian Erste Asset Management has implemented EU Sustainable Finance Disclosure Regulation

The European Union sustainable finance disclosure regulation (SFDR) came into force on March 10, 2021. From this point on, all financial products, including investment funds, must be classified according to their sustainability. This is intended to create more transparency for sustainable investments in financial investment products.

The disclosure regulation of the European Union establishes new transparency rules on the effects of sustainability risks in financial investment products and adverse effects. Austrian Erste Asset Management (Erste AM) has adapted all relevant documents to the new transparency requirements.

Transparency requirements

Source: Erste AM

Sustainability risks in investment decisions

In order to meet the transparency requirements, Erste AM has adapted all relevant documents and published them on its website (for UCITS funds in the prospectuses, for AIF funds in the §21 document). The description of how sustainability risks are included in investment decisions, including an assessment of how they affect the respective product, is set out for all funds in the prospectus/§21 document.

In addition, further adjustments are made in the product-specific documents for sustainable funds in accordance with Articles 8 and 9 of the Disclosure Regulation (ESG annex in the prospectus, ESG information on the web factsheet, accountability reports with ESG reporting from 2022).

ERSTE AM funds and classification according to the Disclosure Regulation

Impact funds such as the ERSTE GREEN INVEST, invest directly in solutions for ecological and social challenges and are classified according to Article 9 of the EU Disclosure Regulation. The proven “ERSTE RESPONSIBLE” funds are recorded as Article 8 products in this scheme: They continue to meet the highest demands on sustainable investments and, in addition to the existing ESG reporting, will also meet the requirements of the Disclosure Ordinance.

For some time now, Erste AM has been consistently pursuing the path to make its product range even more sustainable. At the beginning of 2020, ESG criteria, which can improve the risk-adjusted return, were started to be integrated into funds that were previously managed in a traditional manner. The processes used can, for example, significantly reduce CO2 intensity, better map the quality of corporate management (governance) in the funds and minimize involvement in violations of international standards. We now also classify these funds as Article 8 products (ESG integration). For all other funds, we are continuously evaluating the possibilities of including even more ecological and social factors in the investment process.

About us:

About us: With a sustainably invested volume of over 15 billion euros (December 31, 2020) in more than 50 sustainable mutual funds and several special funds, Erste AM is the market leader in Austria in the sustainability sector. Erste AM also plays a pioneering role in the area of ethics and sustainability: Erste AM launched the first environmental equity fund back in 2001.

Legal note:
Prognoses are no reliable indicator for future performance.

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Legal disclaimer

This document is an advertisement. Unless indicated otherwise, source: Erste Asset Management GmbH. Our languages of communication are German and English.

The prospectus for UCITS (including any amendments) is published in Amtsblatt zur Wiener Zeitung in accordance with the provisions of the InvFG 2011 in the currently amended version. Information for Investors pursuant to § 21 AIFMG is prepared for the alternative investment funds (AIF) administered by Erste Asset Management GmbH pursuant to the provisions of the AIFMG in connection with the InvFG 2011. The fund prospectus, Information for Investors pursuant to § 21 AIFMG, and the key investor document/KID can be viewed in their latest versions at the web site www.erste-am.com within the section mandatory publications or obtained in their latest versions free of charge from the domicile of the management company and the domicile of the custodian bank. The exact date of the most recent publication of the fund prospectus, the languages in which the key investor document is available, and any additional locations where the documents can be obtained can be viewed on the web site www.erste-am.com. A summary of investor rights is available in German and English on the website www.erste-am.com/investor-rights as well as at the domicile of the management company.

The management company can decide to revoke the arrangements it has made for the distribution of unit certificates abroad, taking into account the regulatory requirements.

This document serves as additional information for our investors and is based on the knowledge of the staff responsible for preparing it at the time of preparation. Our analyses and conclusions are general in nature and do not take into account the individual needs of our investors in terms of earnings, taxation, and risk appetite. Past performance is not a reliable indicator of the future performance of a fund.