Policies, reports and industry collaboration

What is it?

The EU’s Regulation on sustainability-related  disclosures in the financial services sector (SFDR) sets out a series of organisational and product level disclosures which must be made by asset managers in their financial product documentation and on their website. It forms part of the EU’s Sustainable Finance Action Plan, a broader package of measures relating to ESG issues. The implementation date of the SFDR is 10 March 2021.

What are we doing?

We support efforts to empower end-investors to make informed decisions on where to allocate their saving, pensions and other investments based on increased transparency from asset managers.

We also support the underlying policy objectives of the SFDR (and wider EU Sustainable Finance Action Plan) in meeting the Paris Climate Agreement objectives, contributing to the achievement of the Sustainable Development Goals, and providing high quality information for investors to prevent “greenwashing”. In August 2020 we responded to the SFDR Consultation Paper and have been closely monitoring and engaging with EU policy makers and industry trade groups on developments in this area.

In June 2020, First Sentier Investors created a formal SFDR project steering group which comprises senior representatives from our RI, legal, compliance, product, marketing, sales and distribution teams. The steering group has been working to implement the SFDR requirements to ensure we are fully compliant with the relevant requirements by the implementation date.

What is it?

The Australian Sustainable Finance Initiative (ASFI) was formed in March 2019 as an industry-led body. Over a period of 18 months, ASFI developed a roadmap to align the finance sector to support greater social, environmental and economic outcomes for the country. The roadmap sets out a suite of 37 recommendations categorised under the following four areas:

1. Embedding sustainability into leadership
2. Integrating sustainability into practice.
3. Enabling resilience for all Australians
4. Building sustainable finance markets

It also includes an Action Plan and suggested timeframes for implementation of each of the recommendations.¹

What are we doing?

First Sentier Investors was pleased to be represented by two employees on two technical working groups. As a business more broadly we engaged with ASFI throughout the process, including inviting the Co-Chairs to engage with us at an RI Steering Group meeting and through presentations to the Australia Management Team. We were proud to support these recommendations when they were released, and look forward to continuing to work closely with ASFI throughout the implementation phase, beginning in 2021.

1. https://static1.squarespace.com/static/5c982bfaa5682794a1f08aa3/t/5fcdb74ee43f2b00a8c74ec9/1607317331508/ Australian+Sustainable+Finance+Roadmap+%E2%80%93+Executive+Summary.pdf

What is it?

In June 2020 the Monetary Authority of Singapore (MAS) proposed a set of guidelines on environmental risk management for fund management companies and real estate investment trust managers. In the consultation paper, the MAS highlighted the need for the financial sector to take action to address environmental risks and support the transition to an environmentally sustainable economy. The guidelines are intended as a call to action to this sector and highlight expectations that financial institutions will enhance the integration of environmental risk considerations as part of their investment process.

What are we doing?

In July 2020 we provided feedback on the consultation paper. The finalised guidelines were released in December 2020. We are currently in the process of adopting the guidelines and look forward to engaging with the MAS further on this topic in due course.