Industry Updates

DWS calls for new SFDR labelling regime

The German asset manager also wants greater stewardship disclosure

Theo Andrew

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DWS has called for a new labelling regime to be implemented under the Sustainable Finance Disclosure Regulation (SFDR).

Responding to the European Commission’s consultation on the regulation, which closed on 22 December, the German asset manager said it backed splitting the existing ‘light green’ Article 8 and ‘dark green’ Article 9 into new product categories.

In addition, the firm said greater disclosures on stewardship should be brought in which support the new labelling system.

It argued for greater disclosure of “quality and quantity” of engagement and policy stewardship activity with minimum standards and reporting for funds looking to qualify under the proposed ‘transition’ label.

The move would run contrary to the UK’s Sustainable Disclosure Regulation (SDR), which reduced the requirements on stewardship following its consultation.

The European Commission launched the consultation last September and extended the deadline for responses to the week before Christmas.

DWS’s call for an overhaul of the current SFDR rules is largely in line with many of the responses calling for a new labelling regime.

Last month, the European Fund and Asset Management Association (EFAMA) called for a new labelling system.

This put is at odds with some of its members such as BNP Paribas Asset Management, which backed a revamping of the current framework by creating sub-categories under Article 8 and 9.

In December 2022, DWS downgraded 10 Paris-Aligned Benchmark (PAB) ETFs from Article 9 to Article 8 ahead of the incoming ‘level 2’ of SFDR.

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