EU's Climate Agenda Puts Pressure on Switzerland: The EU's Sustainable Finance Disclosure Regulation (SFDR), is increasingly putting the Swiss financial center under pressure to take further action in the area of sustainable… esg sfdr eutaxonomie
The EU's Sustainable Finance Disclosure Regulation , is increasingly putting the Swiss financial center under pressure to take further action in the area of sustainable investment. Yet, the country’s international entwinement prohibits Switzerland from going it alone.
Clients can define their sustainability preferences via the EU taxonomy, which incorporates some environmental, social and governance criteria, Principal Adverse Impact exclusions as well as SFDR categorization.
The industry has struggled to adapt to the ESG framework. Partly because the focus has been one-sided, resting on the E , while pushing the S and G components aside. And also because the framework has constantly been adapted in its almost one-and-a-half years of existence.Despite these teething problems, ESG funds now account for about half of all fund assets domiciled in the EU, or about $3.8 trillion, according to estimates by Morningstar.
This is the reason why Helveteq has taken the reins into its own hands, becoming the first Swiss securitization platform to issue ESG investment products that can be traded on the stock exchange.Katz pointed out that a dithering Switzerland could one day find that it has missed the boat. The Swiss financial center is too intertwined internationally to ignore regulatory trends abroad, he said.
In addition to this, there is a growing sense of urgency to move forward with the transition to a climate-friendly economy, now that many banks have signed up to ambitious international UN climate targets, Katz said. Self-regulation has also been in place at the Asset Management Association Switzerland since the beginning of October, which is understood as complementary to the SBA’s guideline.