PAI Statements Remain Scarce

Only 21.6% of European investment management firms have issued a publicly accessible Principal Adverse Impact (PAI) statement, according to research from PwC Luxembourg. An analysis of 2,012 European management firms conducted by the auditing firm found that most had failed to produce the statement, which is required under the Sustainable Finance Disclosure Regulation (SFDR) Regulatory Technical Standards. According to the report, 22.2% of surveyed firms have neither published a PAI statement, nor a declaration on why they did not report on PAIs at entity-level. A further 7.5% of companies have committed to disclosing the PAI data are not compliant with SFDR Level II. Almost 40% of surveyed firms said they did not consider the PAIs of their investment decisions on sustainability factors. The most frequently cited reasons for this were insufficient availability of satisfactory and pertinent non-financial data, and uncertainties on required data collection methods. The report also noted wide variations in the quality of data included in publicly available PAI statements, with a considerable number of declarations incomplete or left entirely blank.

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