Reclaim Finance

Reclaim Finance notes the relevance of the recommendations published by the Platform on Sustainable Finance in the report "Advancing sustainable finance: Technical criteria for new activities & first review of the Climate Delegated Act" (April 2025).

The Sustainable Finance Disclosure Regulation (SFDR) adopted in 2019 triggered a vast movement of self labelling by asset managers. Intended as a classification that would put some order in the European Union sustainable funds market, SFDRs articles 8 and 9 quickly became a source of confusion.

The Sustainable Finance Disclosure Regulation (SFDR) adopted in 2019 triggered a vast movement of self-labelling by asset managers. SFDRs articles 8 and 9 quickly became a source of confusion, notably due to the lack of clear criteria for each category. Category assignments were regularly modified without justification by asset managers depending on internal assessments of compliance risk.

If the European Commission wants to improve the daily lives of European Citizens, the priority should be to protect them and not to focus on alleged "red tape" at the expense of their safety and wellbeing. The current deregulation drive severely weakens - if not erases - key protections for social and environmental rights, necessary to ensure a fair and sustainable future.

The text clarifies that, "within the prudent person principle, PEPP providers shall take into account risks related to and the potential long-term impact of investment decisions on ESG factors". We welcome the explicit inclusion of ESG risk in the prudent person principle. We stress the relevance of the requirements for PEPP providers to consider the long-term impact of their investment.

The text clarifies that, "within the prudent person principle, IORPs shall take into account sustainability risks, as defined in Article 2, point (22), of Regulation (EU) Council 2019/2088 and of the European Parliament in their investment decisions".

The proposed initiative on the competitiveness in the single banking market is largely influenced by the idea that lower capital requirements and prudential obligations would increase bank competitiveness and - in turn - benefit the EU economy. Yet, research shows that there is no evidence that higher capital buffers lead to structural restrictions on lending.