Sustainable Finance Disclosure Regulations (SFDR) and fund classification

This means that you and your clients ought be be able make informed decisions about how funds are invested. Key sustainability matters include:

• the environment
• social and employee issues
• respect for human rights
• anti-corruption and anti-bribery measures

Supporting a more sustainable environment and society

The SFDR regulations also outline economic activities that can be considered a sustainable investment and support a more sustainable environment and society. These include:

• how companies use natural resources e.g. energy, renewable energy, raw materials, water
• a company's contribution to climate change through greenhouse gas emissions
• its impact on biodiversity
• how companies contribute to tackling inequality or support socially disadvantaged communities

Criteria for activities that can be included in the following categories is expected at the beginning of 2023:

• sustainable use and protection of water and marine resources
• transition to a circular economy: producing items by reusing, repairing, refurbishing and recycling as much as possible
• pollution prevention and control
• protection and restoration of biodiversity

What are the fund classifications and their meaning?

Under the SFDR regulations funds fall into one of three categories, based on the fund's sustainability objective:

• Article 6: sustainability considerations are not integrated into the investment process of these funds
• Article 8: funds that promote, among other characteristics, environmental and/or social characteristics. The companies in which the investments are made must follow good governance practices. Article 8 funds are also referred to as light green.
• Article 9: funds that have specifically sustainable investments as their objective. For example, investing in funds that have the goal of reducing carbon emissions. Article 9 funds are also referred to as dark green.

What Article 8 funds are in the Irish Life fund range?*

*at January 2023. This list is subject to change.