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Technology & Data

IA Issues SDR Guidance

The UK’s Investment Association (IA) has released implementation guidance to support the industry in its adoption of the Financial Conduct Authority’s (FCA) Sustainability Disclosure Requirements (SDR). The document uses a Q&A format, providing information on FAQs having arisen since the publication of the FCA’s policy statement on SDR and investment labels in November 2023. Last month, the UK watchdog issued guidance to support the financial industry in meeting its anti-greenwashing requirements, due to come into force on 31 May. The rule will apply to all FCA-authorised firms making sustainability-related claims about products and services, with the full guidance due to apply as of 2 December – alongside the naming and marketing rules under the SDR and labelling regime. The FCA is also consulting on whether to extend the labelling requirement to portfolio managers to make consumer choices easier. Alongside the guidance, the IA issued its market insights survey on industry implementation of SDR to date. The survey covered 68 member firms, which collectively run approximately 3,200 UK authorised and recognised funds. If found finding that two-fifths of them intended to apply a sustainability label to at least one of their funds, with the majority planning on doing so by the end of the year. “Our new guidance on the FCA’s incoming Sustainability Disclosure Requirements (SDR) has been created in close collaboration with member firms, and aims to assist the industry in implementing the new regime,” said Galina Dimitrova, Director of Investment and Capital Markets at the IA.  “We welcome the SDR as a positive step towards clarifying regulatory expectations for sustainable funds, improving industry-wide transparency and empowering investors to make informed choices that align with their sustainability goals.” Alongside other trade bodies, the IA is due to publish specific guidance on consumer-facing disclosure requirements soon.

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