"The new SDR regime is going to have a lasting effect on all advisory firms and the wider financial industry, so it’s absolutely vital we all understand the new rules"
- Bob Hunt, managing director of Paradigm Consulting
Paradigm Consulting has launched a new e-book focused on the new Sustainability Disclosure Requirements (SDR) rules and regime.
Written in association with Tatton Investment Management and EdenTree Investment Management, the e-book focuses on the FCA’s ‘Policy Statement PS23/16: Sustainability Disclosure Requirements (SDR) and investment labels’, how the new regime will impact on advisory firms, particularly in terms of new investment labels, their meaning, and the expectations placed on advisers.
From the 31st July fund managers can begin to use new investment labels which are designed to provide consumers with better information on identifying sustainable products. A Financial Lives survey, conducted by the FCA in 2023, revealed 76% of adults would like to invest in a way that protects the environment and 74% want to invest in a way that has a positive social impact.
The e-book therefore provides information on how the new SDR regime will meet the FCA’s operation objectives such as new investment labels to provide information and protect consumers, disclosure requirements to help the flow of consistent information along the investment chain, with the labels and consumer-facing disclosure helping consumers to compared products more effectively and efficiently.
The e-book gives advisers information on an introduction to the new SDR regime, an implementation timeline, the anti-greenwashing rule, and the new four labels and their key attributes – sustainable focus; sustainability improvers; sustainability impact; sustainability mixed goals.
There is also a raft of information within the e-book on how SDR relates to Consumer Duty, and what it means for distributor firms, advice propositions, financial advisers and support staff.
Paradigm’s team of consultants offer bespoke consultancy support and guidance on all aspects of SDR with its Technical Helpdesk able to review financial promotions and answer queries. Its consultancy team can ensure SDR requirements are being met, its file review team have SDR embedded within the process and its policy team can provide updates on all aspects of SDR.
Bob Hunt, managing director of Paradigm Consulting, commented: “The new SDR regime is going to have a lasting effect on all advisory firms and the wider financial industry, so it’s absolutely vital we all understand the new rules, what they mean, and what they require of us, particularly with regard to the new investment labels.
“This e-book seeks to provide advisers with a full range of information on SDR, the reasoning behind the new regime, what the new rules will hope to achieve, and how firms can ensure their compliance with them, and how they dovetail with Consumer Duty as we seek to ensure positive consumer outcomes for all clients.
“We’ve worked with both Tatton and EdenTree Investment Management to deliver this e-book and we would advise all firms active in this space to read it and ensure they are prepared for what happens next. The anti-greenwashing rules and guidance came into force on the 31st May, while the new investment labels can be used from the end of this month, and the naming and marketing rules come into force from the 2nd December.
“It therefore makes sense to be on top of this, and if firms want further support, they should contact the team at Paradigm Consulting for bespoke help and guidance.”
Adam Kelly, head of adviser distribution at EdenTree, added: “SDR marks a new era for sustainable investing in the UK. The new regulations set a high bar, which will initially present a steep learning curve for the entire industry. We were pleased to work with Paradigm to create this e-book, and hope it will help guide and support advisory firms and individuals as they work to fully understand and implement this important new regime for the benefit of their clients.”
