26th March 2025
March 2025 SRI Services & Fund EcoMarket update
It has been a little while since I've been able to write a newsletter, mostly because working on the Adviser Sustainability Group report has been more time consuming than I had hoped.
Nothing is certain until this report is finalised. However, to give you a flavour of what it is likely include – there look set to be three sections, an introduction on sustainability basics and how sustainable investments work, a best practise framework for advice firms and advisers, and guidance for trainers. Our hope is that it will be published in early summer.
The other big subject at the moment is of course the SDR labelling regimewhich is, shall we say, a ‘mixed’ picture.
The good news is that there are now around 100 funds that have achieved a label.
Those that have ‘gone public’ are showing on our database with their labels. Those that have not are yet actively using their labels show on Fund EcoMarketas ‘working towards’ a label.
So why 'mixed'?
Some funds managers have decided not to opt for labels because they're not technically covered by the rules eg ethical funds. Others have opted out of the FCA approval process, often out of frustration - the FCA's requirements are far more prescriptive than expected, and the regulator appears to be struggling with how these funds work in practice.
These are both showing on our database as ‘Unlabelled with sustainability characteristics’. 'Unlabelled...' funds will be treated similarly to labelled funds by the FCA, in that they will be required to produce client facing disclosure documents also.
Offshore funds and portfolios remain 'out of scope' - and we wait to hear what will happen there.
I explored these issues - and more - in an article written for Investment Life and Pensions Moneyfacts .published last week. 'Exploring rules and rhetoric' covers quite a lot of ground!
Nothing is certain until this report is finalised. However, to give you a flavour of what it is likely include – there look set to be three sections, an introduction on sustainability basics and how sustainable investments work, a best practise framework for advice firms and advisers, and guidance for trainers. Our hope is that it will be published in early summer.
The other big subject at the moment is of course the SDR labelling regimewhich is, shall we say, a ‘mixed’ picture.
The good news is that there are now around 100 funds that have achieved a label.
Those that have ‘gone public’ are showing on our database with their labels. Those that have not are yet actively using their labels show on Fund EcoMarketas ‘working towards’ a label.
So why 'mixed'?
Some funds managers have decided not to opt for labels because they're not technically covered by the rules eg ethical funds. Others have opted out of the FCA approval process, often out of frustration - the FCA's requirements are far more prescriptive than expected, and the regulator appears to be struggling with how these funds work in practice.
These are both showing on our database as ‘Unlabelled with sustainability characteristics’. 'Unlabelled...' funds will be treated similarly to labelled funds by the FCA, in that they will be required to produce client facing disclosure documents also.
Offshore funds and portfolios remain 'out of scope' - and we wait to hear what will happen there.
I explored these issues - and more - in an article written for Investment Life and Pensions Moneyfacts .published last week. 'Exploring rules and rhetoric' covers quite a lot of ground!
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