Funds Hit Brakes as Reclassifications Take Toll: ESG Regulations
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Asset managers grappling with continuous ESG regulatory updates in the European Union may soon opt to fight back, rather than try to adapt to a moving target.
Seen as the world’s most ambitious green investing rulebook when it was enforced in March 2021, the Sustainable Finance Disclosure Regulation has since faced growing criticism. An SFDR update just triggered a huge wave of fund reclassifications, which investment firms, lawyers and even some regulators blame on confusing rules. And there’s more in the pipeline.