Sweep's SFDR Content Hub

Transform regulation into opportunity.

The SFDR in a nutshell

The SFDR (Sustainable Finance Disclosure Regulation) is an European Union regulation designed to enhance transparency and promote sustainable investment practices. It requires financial market participants and advisors to disclose their sustainability policies, ESG (Environmental, Social, and Governance) integration, and the potential adverse impacts of investments on sustainability.

Level 1: Disclosures on ESG factors, including how sustainability risks are integrated into investment decisions, the adverse impacts of investments, and alignment with sustainability goals.
Level 2: Detailed rules on implementing these disclosures, including content, methodology, and presentation.
Principal Adverse Impacts (PAIs)

PAIs refer to significant negative effects an investment may have on sustainability factors, such as environmental damage (e.g., greenhouse gas emissions) or social issues (e.g., human rights violations). Financial market participants must disclose their methods for assessing and managing these impacts, ensuring sustainability risks are part of the investment decision-making process.

Your guide to SFDR Compliance

Gain the tools and knowledge to master SFDR compliance, from requirements to reporting.

Download the guide

Does the SFDR apply to you?

The SFDR applies to a broad spectrum of financial organizations operating within the European Union. This encompasses various entities such as asset managers, fund managers, investment firms, insurance companies, pension funds, banks, financial advisors and other financial service providers.

Additionally, it’s important to note that the SFDR applies to investment managers and advisors who market their products within the European Union, regardless of their geographical location.

Product classifications play a crucial role under the Sustainable Finance Disclosure Regulation (SFDR) in providing transparency and guiding investors in their sustainable investment choices. The SFDR introduces three product classifications.

Article 6 financial products are those that do not promote environmental or social characteristics explicitly.
Article 8 products are those that promote environmental and social characteristics, but do not have sustainable investment as their primary objective.
Article 9 products are those with sustainable investment as their explicit objective, demonstrating a high degree of sustainability.

Deep dive into the SFDR

Climate Essentials

What is the Sustainable Finance Disclosure Regulation (SFDR)?

SFDR

Climate Essentials

The UK SDR vs EU SFDR – What financial organisations should know

SFDR

Blog

The European Commission’s responses to SFDR questions

SFDR

SFDR compliance can be complex and time-consuming

1 - Understand the scope

Familiarize yourself with the SFDR disclosure requirements and determine if your organization falls within its scope based on your role as a financial market participant.

2 - Establish governance and responsibility

Assign clear ownership and accountability within your organization for compliance with the SFDR, ensuring that relevant departments and stakeholders are involved.

3 - Enhance data collection

Implement robust systems to gather and manage relevant data from your portfolio companies. Find the right software provider to help you streamline the data collection process.

4 - Develop SFDR reporting frameworks

Create standardized reporting frameworks and templates to capture the necessary information required by SFDR, ensuring consistency and accuracy in your disclosures and accounting for compliance gaps.

5 - Train and educate staff

Conduct training programs to enhance staff awareness and understanding of SFDR obligations, ensuring that relevant employees are equipped with the knowledge and skills needed for compliance.

6 - Monitor and review

Establish a monitoring and review process to assess the effectiveness of your compliance efforts and make adjustments as needed to ensure ongoing compliance.

How Sweep streamlines SFDR compliance

Step 1

Accelerate your compliance with PAIs

Ensure full compliance with SFDR’s mandatory PAI reporting in a matter of weeks.

Step 2

Engage with your portfolio

Collect data from your investees with surveys or file imports.

Step 3

Track progress in real-time.

Get a live overview of your SFDR compliance progress with the mandatory metrics

Step 4

Calculate mandatory indicators

Automatically consolidate and convert portfolio companies input into PAI indicator results.

Step 5

Generate PAI report in a click

Use your results to create a PAI statement ready to share with the authorities.

They trust Sweep

“Sweep’s emission monitoring dashboards make it easy for asset managers to communicate and answer questions from our investors about financed emissions, carbon intensity, and data quality.”

Emilie Huyghues Despointes

ESG Officer at MV Credit

See how Sweep simplifies SFDR compliance for your organization

Book a demo