In recent years, the surge in environmental, social, and governance (ESG) investing has prompted regulatory bodies in the European Union (EU) and the United Kingdom (UK) to combat the phenomenon of greenwashing in the financial sector. To address this, stringent regulations have been introduced, shaping the landscape for fund managers operating in these regions.
At the forefront of EU efforts is the Sustainable Finance Disclosure Regulation (SFDR), enacted in 2021. SFDR aims to foster transparency and comparability in disclosures made by financial products, thereby thwarting greenwashing practices. The regulation imposes three tiers of obligations on fund managers.
