Risk & Compliance

Level II SFDR: website requirements

In February, European regulators (ESAs) published their final regulatory proposal for further implementation of the Sustainable Finance Disclosure Regulation (SFDR), the so-called Regulatory Technical Standards (further SFDR RTS). In recent months, we have taken you through a new part of this SFDR RTS every month: we discussed the do no significant harm principle, we wrote about the inclusion of adverse effects on sustainability factors and about the pre-contractual disclosure requirement.

This time, we will address the website requirements, as the SFDR RTS has extensive requirements there too.

Product information on the website should include (additional) details for products categorised as light green (Article 8 SFDR) and dark green (Article 9 SFDR). Thus, the SFDR RTS determines where and what information you must publish on the website. The SFDR RTS therefore includes a list of items to be disclosed on that website.

Date:October 11, 2023

First of all, ‘where’ should this information be?

On the website, a separate sub-section ‘Sustainability-related information’ should be included on the product page.

When publishing this information, please consider the following aspects:

  • the law prescribes the order in which the required information must be posted on the website;
  • the information must be published for each individual product;
  • additional language requirements apply if your product is offered in several member states.

Next, what matters is ‘what’ information should be given

The law prescribes exactly what information must be given. You should include information on how the product achieves the sustainable objectives or promotion of sustainable characteristics and how you monitor whether these are met. In addition, you must indicate what portion of the product invests in sustainable investments. You must also provide information on the engagement you have carried out, for example.

Does this information sound familiar to you? It may be true. Some of this information is also in the pre-contractual information. So, to meet the website requirements in terms of content, you can use the information you have already collected for the pre-contractual product information.

That sounds simple, right? Unfortunately, you cannot simply copy paste the pre-contractual product information onto the website. While the website requirements have many similarities with the pre-contractual information, there are also additional requirements that are – it seems – arbitrarily placed between them. And (partly) because of this, the order and content of the website requirements is not quite the same as that of the pre-contractual product information. Thus, simply copying the pre-contractual product information is not an option.

However, there is also good news. The above does not mean that you cannot use the copy paste button at all. In fact, you will have to in order to be consistent. You just need to be very careful when doing so. How can you do that?

Pre-contractual information versus website obligations

Via a table that you arrange as follows: you list the website obligations as listed in the SFDR RTS. Below each other and at sub-level. On the left-hand side, you add the requirements from the pre-contractual product information corresponding to the website obligation. Once you have done that, you can check whether the information you need to publish on the website has already been collected (or is in the process of being collected) via another SFDR obligation, e.g. for the declaration of adverse effects on sustainability (Consideration Statement) or the upcoming reporting obligation. You can add this to the right-hand side of the table. The obligations you will then be left with will be standalone additional website obligations.

Of course, creating a table is not a requirement. However, it does help you reuse the multitude of information you need to publish, identify cross-links between different transparency requirements and ensure consistency. In addition, the table ensures that you can also quickly process and update all publication requirements in the future when changes are made to product information, for example.

In short, a labour-intensive investment for now, but one you will enjoy for years to come.

Want to know more?

Do you have questions about website requirements from the SFDR? Or could you use support in identifying or implementing (upcoming) ESG regulations? We are happy to tell you more about ESG regulations for the financial sector, and their impact on your business. Contact us for more information, or follow our SFDR e-learning.