The BBP has submitted its response to the Financial Conduct Authority's Consultation Paper CP22/20 on Sustainability Disclosure Requirements (SDR) and investment labels.

The BBP held a virtual roundtable event on the 24th November 2022 to discuss the FCA’s SDR proposals and consultation. The responses to the consultation questions are adapted from a draft prepared by an informal industry working group comprising AREF, BPF, CREFCE, INREV and IPF, to which the BBP was an observer. Text in black is retained from this draft and reflects content which the BBP agrees with. Text in blue reflects additional comments made by BBP members during the meeting outlined above.

The BBP welcomes the FCA efforts to address greenwashing, clarify labelling and marketing rules, and seek international coherence between SFDR and SDR. However, there are concerns in the market with this mapping approach: for instance, there are a number of SFDR Article 8 products which will not meet the criteria to qualify for a SDR sustainable label (particularly since the proposal for a “Responsible” label has been dropped). It is important that these products are still able to accurately disclose their sustainability characteristics, despite not qualifying for a label. Although the requirements do not directly map across, we welcome a number of improvements in the SDR (e.g., the recognition of transitioning investments as qualifying for a label).