Rothschild & Co Asset Management Europe has committed to actively support the transition to a sustainable economy and decided to classify the vast majority of its funds in SFDR categories 8 and 9.
In November 2018, the European Commission undertook to cut greenhouse gas (GHG) emissions to achieve climate-neutral economy by 2050. As part of this effort, it asked the financial sector to make reforms to support the transition to a more sustainable economy.
European Regulation (UE) 2019/2088, the “Sustainable Finance Disclosure Regulation (SFDR)” represents part of this project and seeks to improve transparency on the sustainability risks faced by investments1.
The Regulation takes effect from 10 March 2021 and imposes new transparency obligations on market players and financial advisers. Specifically, it requires portfolio management companies to classify their funds into one of three categories:
“Article 9” (“dark green”) products, whose objective is sustainable investment, i.e. investment in an economic activity that contributes to an environmental or social objective;
“Article 8” (“light green”) products, which promote environmental and social characteristics as part of their general investment strategy;
“Article 6” (“grey”) products, which either consider ESG risks as part of the investment process or are explicitly declared as non-sustainable.
Legal documentation for the funds and details of the new policies on incorporating sustainability risks can be found at: https://am.eu.rothschildandco.com
In line with its commitment to a more sustainable economy, Rothschild & Co Asset Management Europe has chosen to classify most of its funds as Article 8 or 9 products, covering 96% of assets under management in its open-ended funds.
1 “Sustainability risk” means an event or situation in the environmental, social or governance field that, if it occurs, could have a material negative impact on the value of the investment.
