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OPINION: The evolution of SFDR and its objectives

European flags fluttering against the headquarters of the European Commission
Photo: HJBC/Getty Images

For asset managers, the introduction of SFDR 2.0 should not be viewed as a compliance exercise alone, but also as a constructive step toward a more coherent sustainable finance framework.

The evolution of the Sustainable Finance Disclosure Regulation (SFDR) reflects both the ambition and the growing pains of the European Union’s attempt to channel private capital toward sustainability objectives.

When SFDR was first introduced, its primary function was rooted in transparency. It aimed to effect change, correcting information asymmetries

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