Posted on Dec. 2021 at 10:00
Often criticized by the world of finance, European regulations sometimes create calls for air. In 2021, asset management companies had only one word of mouth: SFDR. This European regulation governs the sustainable reporting of funds, compulsory since last March. The profession took advantage of this measure to classify a large part of its products in the most virtuous categories (articles 8 and 9), without any real control for the moment.
In 2022, the acronym MiFID II will come back to the fore. In August, major changes to this directive, which governs the sale of savings products in Europe, will come into force: sellers of savings solutions will now have to assess the preferences of individual investors in terms of “sustainability”.
“The client will speak with his guts”
While institutional clients and high net worth individuals are already fond of or well served in terms of sustainable funds, “there will be a great movement on the side of our distributor clients”, predicted Valérie Baudson, CEO of Amundi, during the presentation of its new sustainable roadmap.
“The revision of the MiFID II regulations is a huge accelerator because distributors will have to ask clients questions on subjects that speak to them, affect them,” explains Pierre Moulin, member of the executive committee of BNP Paribas Asset Management. For example, to know if they are sensitive or not to ESG [critères environnementaux, sociaux et de gouvernance, NDLR]. “Failing to be an expert in sustainable finance,” the client will speak with his guts “, enthuses another manager of a management company.
While bank or independent advisers are not supposed to guide savers’ choices in favor of a particular strategy (climate, employment, biodiversity, etc.), opening the discussion will give more visibility to so-called sustainable products. “In the future, we can imagine that the investors’ portfolio will consist of ESG management supplemented by themes,” anticipates Pierre Moulin.
Especially since the “Mifid questionnaires” are not written by the regulator, but left in the hands of the marketers. Some work hand in hand with their main suppliers, the management companies. For example, to know if a particular product will be eligible or not for the customer’s response. “Everyone is trying to be ready for next August. But there are a lot of discussions between players because the texts are not always clear, ”points out Pauline Becquey, Managing Director of Finance for Tomorrow, the sustainable finance branch of the Paris Europlace lobby.
2% of eligible funds?
“There is a problem of chronology because the ink is not dry on the transparency of sustainable funds (SFDR), the ESG data of companies (CSRD) and the list of green activities (taxonomy)”, recalls Jean-Baptiste Morel, ESG research manager at Arkéa Investment Solutions. In the meantime, we are doing what we can with our internal data and that of our ESG data provider to measure the sustainability of our products. “
Some managers are considering publishing green unit ranges in their fund documentation. Or even to withdraw. “We are campaigning, like other management companies, for the publication of a disclaimer [avertissement, NDLR] stipulating that the data needed to calculate the percentage alignment of funds with taxonomy is currently not available, ”says Nathaële Rebondy, European sustainability manager at Schroders.
If the players opt for strict sustainability criteria, the supply could be insufficient. Only 2.8% of European funds have a clear sustainable objective within the meaning of “article 9” (highest category of SFDR), 2.5% have a responsible investment label and around 2% of turnover. Euro STOXX 50 business is aligned with taxonomy, according to the Indefi firm.