1. Introduction
This article is about a new topic which increasingly requires significant attention of the compliance function of asset managers: compliance with new requirements on sustainability disclosures towards clients and investors. Since 10 March 2021, asset managers, such as fund managers, banks, MiFID investment firms, pension funds and insurance companies, are subject to detailed transparency requirements towards clients and investors on the sustainability characteristics of the financial products which they offer. These requirements have their basis in the so-called Sustainable Finance Disclosure Regulation (SFDR).2Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector. The SFDR aims to prevent "greenwashing"3Meaning the practice of gaining an unfair competitive advantage by recommending a financial product as environmentally friendly or sustainable, when in fact that financial product does not meet basic environmental or other sustainability-related standards. and increase comparability of financial products as regards their sustainability characteristics. Amongst others, asset managers4The asset managers covered are defined in article 2 sub 1 SFDR. In the SFDR, the parties subject to the SFDR are referred to as "financial market participants". For the remainder of this article, I will refer to the "financial market participants" as asset managers. Certain financial advisers set out in article 2 sub 11 SFDR are covered by the obligations set forth in the SFDR as well. This article will not go into the specific disclosure requirement for financial advisers. should: