Maybe you’ve heard of it, maybe not, but what is SFDR? This stands for Sustainable Finance Disclosure Regulation. It might sound confusing, but you will see that it is very useful. Who does it apply to? Do you need to do anything with those regulation? The quick answer is no, but there is something you need to know about it. This is because it EU parliament thought that there was not enough information available for investors. That means that all financial market participants have to show the information about the sustainability risks and also how they implement it into their services. They have to show what they do to be more green and the costs of this. They also implemented this regulation to prevent companies from greenwashing. That means that they say they are a green company, but when you check it, it will turn out that it ain’t a green company at all.
Who does it apply to?
When you go deeper into it, you will also see that it does not apply to every company. Since it is about investors and financial participants, SFDR applies to companies like that. For example, the bank, stock market, retirement funds and such.