On 25 March 2022, the European Supervisory Authorities (ESAs) updated their joint supervisory statement on the application of the Sustainable Finance Disclosure Regulation (SFDR). The updated statement includes a new timeline, expectations about the explicit quantification of the product disclosures under Articles 5 and 6 of the Taxonomy Regulation, and the use of estimates. The updated statement replaces the initial joint supervisory statement, which was released in February 2021.
In terms of timing the ESAs recommend that Member State national competent authorities and market participants use the current interim period from 10 March 2021 until 1 January 2023 to prepare for the application of the forthcoming Commission Delegated Regulation containing the regulatory technical standards while also applying the relevant measures of the SFDR and the Taxonomy Regulation according to the relevant application dates outlined in the supervisory statement.
As for Articles 5 and 6 of the Taxonomy Regulation, the ESAs provide that the supervisory expectation for disclosures during the interim period is that financial market participants should provide an explicit quantification, through the numerical disclosure of the percentage, of the extent to which investments underlying the financial product are taxonomy-aligned.