Most Read Contributor in Luxembourg, February 2017
Hitherto, firms have been encouraged by investors, by
regulators, or by governments to adhere to recognised principles
for responsible investment such as the United Nations' backed
Principles for Responsible Investments (UNPRI). But encouragement
is hardening into mandate. Firms can
expect to see a steady move from industry good practice to rules,
and from general regulatory guidelines to law.
Previously a subject left to industry good practice and investor
demands, socially responsible investment (SRI) is beginning to move
up the regulatory agenda. As a result of the new legally-binding
treaty on climate action agreed on in Paris nearly a year ago,
policy makers are turning their attention to how they can encourage
or require investors and investment managers to adopt strategies
that will support countries in meeting their new commitments.
French law has already been modified to require more specific
disclosure in the management report of French entities, including
investment funds, on the resources put in place to contribute to
environmental improvements. The investment manager must consider
the assets in which it invests its clients and their impact on the
environment. The new rules are applicable from the end of this
ESMA is considering how the provision in the new Key Information
Document relating to an investment product's environmental
objective might ensure proper transparency. And MEPs across the
political spectrum are seeking the industry's views about what
more needs to be done at the legislative level.
Initial thoughts emerging include the need for clarity on:
what is and what is not SRI
convergence of accounting and reporting requirements
standardisation of the identification and calculation of
Concerns have also been expressed that regulatory and tax
initiatives need to be better aligned, both with each other and
with a long-term investment view.
Meanwhile, investing institutions are increasingly incorporating
green investments into their portfolios. These might be new
investments or existing investments that are brought into
compliance with SRI requirements.
Since Luxembourg is the first domicile for responsible investing
funds in Europe in terms of assets under management,1
investment managers setting up their funds in the Grand Duchy have
a key role to play in helping to encourage investing institutions
in the right direction via their communications and the investment
strategies they offer. They must start asking themselves:
How well and how regularly are we engaging with our
institutional clients on SRI issues?
Are we explaining SRI-compliant products clearly and
effectively to retail investors?
How embedded in our investment offerings and processes is SRI
Do we need to review our current investment and operational
Can we bring existing products and strategies into compliance
with recognised SRI principles?
Are we engaging with regulators and legislators as they
consider new rules?
Now is the time for investment managers to engage in the
European and global debates, to have a regular dialogue with their
clients on SRI issues, and to evolve their investment strategies
and product options for a world in which SRI becomes the
norm—not a nice-to-have extra.
1 European Responsible Investing Fund Survey 2015,
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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As the banking industry continues to be shaped by technological and regulatory forces, we’ve gathered our European Central Bank (ECB) experts to hold a conference about this changing landscape. KPMG’s ECB desk from Frankfurt will join our Luxembourg banking partners to unpack the latest news from the ECB, including regulations that will affect the future of banking.
We would be very pleased if you could attend this event, which will be held at our Luxembourg headquarters in Kirchberg on 30 March. The talk will begin at 5:00pm and last until 6:00pm, at which point the evening will be turned over to a networking session with drinks.
Please let us know if you are able to attend by using the registration button above (by 27 March, if possible).
We look forward to seeing you there!
Here in Luxembourg, LPEA are holding an event which will offer new initiatives by bringing General Partners (GPs) and Limited Partners (LPs) together to examine and speak on the industry from the “360” perspective, leaving no stone unturned. We are a sponsor of the event, as well as having a speaker present. David Capocci, Partner and Head of Alternative Investments will be offering his own insight on the industry nowadays.
ICT Spring is a global technology conference that welcomes various international professionals from the technology space. It is a two-day yearly event which is held in Luxembourg City, “at the heart of Europe, and offers the participants a unique opportunity to deepen their digital knowledge, capture the value of the fast-growing FinTech industry, and explore the impact of space technologies on terrestrial businesses, through exhibitions and demonstrations of the latest tech trends and innovations.”
Over the last 40 years, the Cayman Islands has matured into one of the world's most sophisticated and successful international financial centres, providing a competitive, effective, transparent, cost-efficient and tax-neutral platform for international capital flows underpinned by an environment of legal, political and economic stability.
UCITS are permitted to invest up to 100% of their assets in other open-ended collective investment schemes ("CIS") where those CIS are:
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