A Homogeneous Path to Communicate ESG Values

A standardized and Machine-Readable Solution 

Are you aware and interested in the FinDatEx European ESG Template (EET)? Well, if you are a financial market participant, you should keep reading.

European asset managers are facing a very complex and changing regulatory landscape with an increasing pressure to disclose more ESG data to investors under specific requirements defined by the Sustainable Finance Disclosure Regulation (SFDR), Taxonomy Regulation, Market Financial Instruments Directive II (MiFID II) and the Insurance Distribution Directive (IDD). For this reason, FinDatEx has developed the EET to support asset managers in the exchange of ESG market data from fund groups to distributors. Even if the EET is not mandatory reporting, but a standardized and machine-readable template developed by the financial industry for asset managers, banks and insurance companies; this solution will help financial market participants to be compliant within the two most important upcoming deadlines: MiFID II and IDD coming in August 2022, and the SFDR & Taxonomy level 2 in effect January 2023. Each of the 620 different fields of the EET indicate 1 of the 3 regulations: SFDR, MiFID, or IDD.  The EET’s scope applies to all funds (the template provided on a share class level) and structured products. The fields of the EET are classified as mandatory, conditional or optional to disclose based on the financial product classification (largely for art.8 and art.9 products) while other products have very limited EET requirements at this stage.

Feeling the need of EET

To summarize, the EET will simplify the ESG data communication process between financial market participants in a machine-readable format to fulfill regulatory requirements. Furthermore, the EET will require a wide range of technical fields including SDG alignment, fund revenue exposure to EU Taxonomy and PAI indicators, and negative screening criterias involving companies and sovereigns. 

Understandably, the large amount of data and the granularity required to prove compliance is still a difficult challenge to address for many financial institutions.

With Physis you can access a wide range of granular sustainability data for your financial products, from the SDG alignment to the analysis of Taxonomy coverage. Additionally, we have expanded our SFDR PAI data package, now covering all corporate and sovereign PAI indicators, both mandatory and voluntary. Beyond our PAI data, our clients can have access to a broad suite of ESG data, quantitative environmental and social impact indicators and EU Taxonomy Solution to support the ‘do no significant harm’ principle.