Consultation on integrating sustainability risks and factors in the UCITS Directive and AIFMD

19 February 2019

Consultation response

On 19 February 2019, Finance Watch responded to a consultation held by the European Securities and Markets Authority (ESMA) on its draft technical advice regarding possible amendments to the delegated acts under UCITS Directive and AIFMD on the integration of sustainability risks and factors.

In its response Finance Watch supported the proposal to include sustainability factors in the relevant articles on the organizational requirements, provisions relating to due diligence and in risk-management procedures. Finance Watch also stressed the importance to detail the procedures on the identification and monitoring of sustainability risks.

Finally, Finance Watch highlighted that the concept of sustainability risk should not be limited to the financial materiality, because that would be in conflict with the concept of a sustainable economic system, where the negative externalities are minimized.