Sustainability Community

Hello again,

Another couple of SDR questions I am facing difficulties with. I would therefore appreciate any views / feedback.

1) Firstly, the 'Sustainability Impact' label...
One of the label descriptions is: 

Firms may contribute positive impact through investment activities e.g., engagement with products assets, investing in IPOs, participating in new rounds of capital raising, direct new capital to projects and activities that offer solutions to E/S problems.

Whilst a Sustainability Impact Fund can be a Public fund according to the FCA, this is the point I struggle to apply to a Public fund, except the 'Engagement' piece.

Is it that as long as we are setting out an objective / intentionality of the engagement, this is okay? We are a small asset manager, therefore usually owning a small amount in a company. To claim that 'causality' of an engagement can be pretty hard to prove...

OR do we need to be doing more than those Engagements to prove this characteristic of the Label?

2) The non-label category

This category is applicable to funds 'using sustainability terminology in name or marketing' (e.g. ESG, environment, social, climate, sustainable, green, transition, net zero, responsible, SDGs etc.)

Would this label and the disclosures be applicable if the fund as a specific 'Approach to ESG document', applies exclusions, is considered within the company level RI policy, has RI Factsheets etc. etc.

Where is the fine line between disclosures vs marketing?

Thank you in advance.

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Francesca Wheble
Responsible Investment Analyst
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hi Francesca

1.  RE: Impact label - You might want to look at feedback in the PS, p32 under General Qualifying criteria which removes the casual link between stewardship, as well as specific Impact criteria where an escalation plan is required for actions where assets do not demonstrate sufficient progress towards sustainability objectives and/or KPIs (see p. 43 overview).  Hope that's useful, J
   
   
   
   

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James Doyle
Director, Green Finance, Investment Management
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Original Message:
Sent: 29-01-2024 09:58
From: Francesca Wheble
Subject: SDR - Sustainability Impact / Non-Label Funds

Hello again,

Another couple of SDR questions I am facing difficulties with. I would therefore appreciate any views / feedback.

1) Firstly, the 'Sustainability Impact' label...
One of the label descriptions is: 

Firms may contribute positive impact through investment activities e.g., engagement with products assets, investing in IPOs, participating in new rounds of capital raising, direct new capital to projects and activities that offer solutions to E/S problems.

Whilst a Sustainability Impact Fund can be a Public fund according to the FCA, this is the point I struggle to apply to a Public fund, except the 'Engagement' piece.

Is it that as long as we are setting out an objective / intentionality of the engagement, this is okay? We are a small asset manager, therefore usually owning a small amount in a company. To claim that 'causality' of an engagement can be pretty hard to prove...

OR do we need to be doing more than those Engagements to prove this characteristic of the Label?

2) The non-label category

This category is applicable to funds 'using sustainability terminology in name or marketing' (e.g. ESG, environment, social, climate, sustainable, green, transition, net zero, responsible, SDGs etc.)

Would this label and the disclosures be applicable if the fund as a specific 'Approach to ESG document', applies exclusions, is considered within the company level RI policy, has RI Factsheets etc. etc.

Where is the fine line between disclosures vs marketing?

Thank you in advance.

------------------------------
Francesca Wheble
Responsible Investment Analyst
------------------------------