The Disclosure Puzzle: The Role of PACTA

This report provides further details on ways PACTA can help enable financial institutions to respond to growing legal and societal pressure to incorporate climate-related considerations into their investment decisions.

On March 10th, alongside existing recommendations by the Taskforce on Climate-Related Finance Disclosures (TCFD), the EU Sustainable Finance Disclosure Regulation (SFDR) came into effect. This far-reaching regulation requires EU financial institutions to disclose sustainability-related information at both entity- and product-level, as well as details on sustainability risks. Additionally, under the upcoming EU Taxonomy Regulation slated for 2022, many financial institutions will be required to disclose whether and to what extent their products invest in “green” activities.

PACTA can help financial institutions proactively integrate existing and upcoming requirements into their business processes. For instance, when it comes to the SFDR, PACTA allows investors to get a granular view of their exposure and alignment in eight climate-critical sectors, thereby helping them manage and be transparent about adverse sustainability impact and sustainability risks.