Eurosif published an assessment of the European Commission’s review of the Sustainable Finance Disclosure Regulation (SFDR), welcoming the move to introduce three sustainability-related product categories and a clearer expectation that ESG or sustainability-related product claims must be supported by compliance with SFDR criteria. It nevertheless cautioned that elements of the redesign could still leave room for greenwashing and reduce investor comparability. The statement notes that SFDR has improved transparency since its application in 2021 but that unclear core definitions and the market’s use of Articles 6, 8 and 9 as a de facto classification system have driven diverging interpretations, fragmentation and greenwashing concerns. Eurosif argued that basic criteria and limited exclusions in the new approach may not sufficiently prevent greenwashing, and that while a new “impact” transparency layer is a positive addition, removing key entity-level disclosures and rolling back certain product-level disclosures could weaken comparability. It also flagged that excluding portfolio managers from scope may create operational gaps. Eurosif plans to publish detailed recommendations for EU co-legislators in the coming weeks.
Eurosif 2025-11-20
Eurosif welcomes SFDR review’s new product categories but warns greenwashing and disclosure rollback risks persist
Eurosif reviewed the European Commission’s SFDR, supporting three sustainability-related product categories and clearer ESG compliance expectations. However, Eurosif warned the redesign might still permit greenwashing and reduce investor comparability due to unclear definitions and limited exclusions. It also noted potential operational gaps from excluding portfolio managers and removing certain disclosures.