New Q&As on application of Guidelines on funds’ names
Published 16 January 2025
Category: Impact and ESG
ESMA has published Q&As for Guidelines on funds’ names using ESG or sustainability-related terms (the “Guidelines”). The purpose is to ensure that the Guidelines are interpreted and applied in the same manner across Europe.
The question is whether applying the exclusions referred to in the Guidelines paragraphs 16-18 – according to which investments in specific companies are excluded when specific terms are used in the name of a fund – affects whether a fund manager can consider the underlying project for use of proceeds instruments or should consider the whole issuer.
It has been clarified that when it comes to investments in European Green Bonds issued under the Regulation (EU) 2023/2631 (European Green Bonds Regulation), the investment restrictions in relation to exclusion of companies in accordance with paragraphs 16-18 of the Guidelines do not apply. When it comes to investments in other green bond instruments, the exclusions should apply on a look-through basis to determine that the instrument does not finance any of the activities listed in the exclusions.
The question concerned whether investing “meaningfully” in sustainable investments – which is one of the requirements when using sustainability-related terms in the name of a fund – require fulfilment of a minimum level.
It has been clarified that despite being a case-by-case analysis for the national competent authorities, the general understanding must be that investing “meaningfully” require a proportion of sustainable investments of 50 % or more.
The question concerned the interpretation of controversial weapons referred to in the exclusions in paragraphs 16-18 of the Guidelines. The clarification specified that the list of controversial weapons provided as indicator 14 in Annex I of the SFDR should be used.
Next step
As further specified in our previous Pulse update on the guidelines on funds’ names, the Guidelines apply from 21 November 2024 for funds established after this date, whereas for funds established before 21 November 2024, the Guidelines will apply from 21 May 2025.
Tags: ESMASustainability
Also tagged ‘ESMA’
ESMA consults on proposals to digitalise sustainability and financial disclosures
The European Securities and Markets Authority has published a consultation paper seeking stakeholders’ view on how the European Single Electronic Format can be applied to sustainability reporting for the purpose of easing the burden associated with financial reporting.
ESMARegulatory Technical StandardsSustainabilityThe Danish Financial Supervisory Authority publishes guiding statement on alternative investment fund managers’ inclusion of leverage in unlisted companies and issuers
On 17 December 2024, the Danish Financial Supervisory Authority (Danish FSA) published a guiding statement regarding the inclusion of leverage by alternative investment fund managers (AIFMs) in unlisted companies and issuers.
AIFMDDanish RegulationESMAThe Danish FSAESMA Initiates Data Collection on Investment Costs for AIFs and UCITS
On 14 November 2024, the European Securities and Markets Authority (“ESMA”) announced that ESMA, together with the national competent authorities, has launched a comprehensive data collection exercise focusing on the costs linked to investments in Alternative Investment Funds (“AIFs”) and Undertakings for the Collective Investment in Transferable Securities (“UCITS”).
AIFMDESMANational versions of guidelines on funds’ names now published
On 21 August 2024, the European Securities and Markets Authority (“ESMA”) published their guidelines on funds’ names (the “Guidelines”) in versions translated into all the official EU-languages.
ESMASustainabilityMeasures to support corporate sustainability reporting
In July, the European Securities and Markets Authority (“ESMA”) published measures to support corporate sustainability reporting.
CSRDESMAESRSSustainabilityESMA opinion on sustainable investments: Facilitating the investor journey
On 24 July 2024, the European Securities and Markets Authority (“ESMA”) published an opinion: “Sustainable investments: Facilitating the investor journey – a holistic vision for the long term” setting out ESMA’s long-term vision on the functioning of the Sustainable Finance Framework.
ESMASustainabilityFinal Report from ESMA with guidelines on funds’ names
The European Securities and Markets Authority has published a final report containing guidelines on funds’ names using ESG or sustainability-related terms.
ESMASustainabilityDraft guidelines on Enforcement of Sustainability Information out for consultation
The European Securities and Markets Authority (“ESMA”) has sent draft Guidelines on Enforcement of Sustainability Information (“Guidelines”) out for consultation.
ESMASustainabilityFinal Report with amendments for RTS
The European Supervisory Authorities (EBA, EIOPA and ESMA) (together ESAs), published a Final Report with proposed amendments to the Commission Delegated Regulation (EU) 2022/1288 and the Regulatory Technical Standards (RTS) in December 2023.
Disclosure RequirementsESMARegulatory Technical StandardsSustainabilityChanges to the SFDR RTS proposed by ESA Final Report
The European Supervisory Authorities (EBA, EIOPA and ESMA) (together ESAs), published a Final Report with proposed amendments to the SFDR Delegated Regulation (Regulation (EU) 2022/1288) and the SFDR Regulatory Technical Standards (RTS) in December 2023.
Disclosure RequirementsESMARegulatory Technical StandardsSustainabilityELTIF 2.0 in force
Today, 10 January 2024, the transition period for the regulation of 15 March 2023 amending the Regulation for Long-Term Investment Funds (ELTIFs), also known as ELTIF 2.0, has ended. Thus, ELTIF 2.0 has now completely entered into force.
ESMARegulatory Technical StandardsRetail InvestorsNew reports on the understanding of greenwashing
The progress reports are a result of a push from stakeholders requesting greater market integrity, investor protection and trusted environments for sustainable investments as sustainability has become an important competitive factor.
ESMASustainabilityConsultation on the ESAs review of SFDR
The European Supervisory Authorities (EBA, EIOPA and ESMA) have earlier this month published a consultation paper in which they propose amendments to the Commission Delegated Regulation.
Disclosure RequirementsESMARegulatory Technical StandardsSustainabilityESMA consultation on the use of ESG or sustainability-related terms in fund names
On 20 February 2023, ESMA closed their consultation on Guidelines on funds' names using ESG or sustainability-related terms launched back in November 2022.
ComplianceESMASustainabilityOpinions issued on the draft European Sustainability Reporting Standards
The European Financial Reporting Advisory Group (EFRAG) submitted a draft set of European Sustainability Reporting Standards (ESRS Set 1) to the EU Commission in November 2022.
ComplianceCSRDESMAESRSSustainabilityESMA Provides Guidelines for Funds’ Use of ESG Related Terms
On 31 May 2022, the European Securities and Markets Authority (ESMA) published a supervisory briefing which provides guidance on sustainability risks and disclosures in investment management.
Disclosure RequirementsESMASustainabilityESMA has Issued Guidelines on Marketing Communication
The guidelines apply to all marketing communication addressed to investors or potential investors for AIFs, including amongst others when they are set up as EuVECAs.
Cross-BorderESMAMarketingPre-MarketingVenture CapitalESMA Publishes Letter to the European Commission on the AIFMD Review
On 19 August 2020, ESMA published a letter to the Commission, outlining areas it should consider during the forthcoming review of the AIFMD.
AIFMDAIFMD reviewESMAESA issues Joint Supervisory Statement on the Application of Scope of the PRIIPs Regulation to Bonds
The statement seeks to mitigate the risk of divergent application, by national competent authorities, for determining the type of bonds for which it is necessary to draw up a Key Information Document (KID).
Disclosure RequirementsESMAKID / PRIIPSESA issues Consultation Paper on Amendments to the Existing PRIIPS Regulation
On 16 October 2019 ESA has issued a consultation paper on amendments to existing rules underpinning the Key Information Document (KID) for Packaged Retail and Insurance-based Investment Products (PRIIPs).
Disclosure RequirementsESMAKID / PRIIPSESMA Submits Report on Sustainability Risks and Factors in the AIFMD and UCITS Directive
On 30 April 2019, the European Securities and Markets Authority (ESMA) published its final report on integrating sustainability risks and factors relating to environmental, social and good governance considerations in the AIFMD and UCITS Directive.
AIFMDESMAGovernanceRegulatory Technical StandardsRisk ManagementSustainabilityESMA Consults on Regulatory Technical Standards Under the ELTIF Regulation
On 28 March 2019, the European Securities and Markets Authority (ESMA) issued a Consultation Paper on draft Regulatory Technical Standards (RTS) under article 25 of the ELTIF Regulation.
ESMAKID / PRIIPSManagement RemunerationRegulatory Technical StandardsOther updates
Main recommendations from the report on advancing sustainable finance
The work performed by the Platform on Sustainable Finance has focused on developing technical criteria for new economic activities and reviewing activities included in the Commission Delegated Regulation (EU) 2021/2139 of 4 June 2021 supplementing Regulation (EU) 2020/852.
SustainabilityThematic review of engagement information
The Danish Financial Supervisory Authority (the “DFSA”) has conducted a thematic review of six pension companies and investment managers and their engagement information (active ownership).
SFDRSustainabilityAn update on the stop-the-clock proposal and the ESRS simplification mandate
On 29 April 2025, a majority of the Danish Parliament agreed on the “stop-the-clock” directive which will go to a formal vote in the fall to adopt the proposal into Danish legislation.
CSDDDCSRDSustainabilityAIFMs: Marketing under increased regulatory focus
The Danish Financial Supervisory Authority (FSA) has published a thematic report on how managers of alternative investment funds and investment management companies market their investment funds.
KID / PRIIPSMarketingThe Danish FSAThe European Commission has launched a targeted consultation on obstacles to capital markets integration across the EU
The European Commission has launched a targeted consultation to gather feedback on obstacles to capital markets integration across the EU.
ComplianceCross-BorderThe Danish Parliament has adopted regulation to implement the NIS2 Directive and the CER Directive
On April 29, 2025, on the day where major parts of France, Spain, and Portugal suffered severe utility breakdowns, the Danish Parliament adopted the bills for implementing the NIS2 Directive and the CER Directive.
CERCritical SectorsCybersecurityNIS2