Investire | October 2021

The level of awareness of ESG themes has been growing dramatically since 2018, among both financial professionals (+45%) and their clients (+ 66%), especially among clients with a larger asset size (from 15% to 42%).

The reasons lie not only with the damage caused by climate change, but also with the attention dedicated to issues pertaining to environmental, social, and corporate governance by the industry of asset management and financial consultancy.

Lately, the pandemic has intensified the general sense of vulnerability, making people more responsive to all issues concerning humankind and its relationship with the planet.

A FINER survey on the AMCs’ communication activities revealed some interesting data: between 2018 and 2021, the number of AMCs that focus their information on issues related to sustainability has increased fivefold, from 7 to 34.

Such extraordinary evidence testifies to the power of a single industry to change the destiny of the world.

Part of the EU action plan on sustainable finance, the Sustainable Finance Disclosure Regulation (SFDR) came into force on 10 March 2021 and forms part of set of tools that connect the areas of economic democracy, financial sustainability, and corporate social responsibility. In fact, the SFDR aims at introducing a shared definition of the term “sustainability” for financial investments and transparency obligations for the agents who manage them.

The SFDR categorizes sustainable financial products on the basis of a list of criteria.

Financial products fall within article 9 when their goal is sustainable investment (that is, with a strong ESG focus). Article 8 covers financial products that promote environmental and social features (with average ESG focus). Financial products that do not meet article 8 or 9 requirements (that is, no ESG focus) fall within the scope of article 6.

Today, several companies include ESG ratings. Similarly, the distribution system (banks and financial networks) has adopted verification systems with sustainability indicators.

However, today a comparison between the number of article 9 financial products and the number of AMCs that claim to include an ESG offer stresses the fact that we are currently at the early stages of a long and hopefully nonreversible process.

Otherwise, the whole financial industry will run the risk of being considered virtual rather than virtuous, reducing the chance for Italians to turn from savers into investors. 

Nicola Ronchetti