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ESG Investing / Asset Management
Fidelity funds convert to Europe SFDR strategies
Actively managed Sustainable Eurozone, US Equity Funds classified Article 9 compliant
The Asset 7 Sep 2023

Fidelity International has expanded its fund range to include two funds classified as Article 9 – the highest sustainability designation under Europe’s Sustainable Finance Disclosure Regulation (SFDR) rubric  – that are active strategies open to retail, wholesale and institutional clients.

The funds – the Sustainable Eurozone Fund and the Sustainable US Equity Fund – address growing client demand for strategies that invest in issuers that contribute to and benefit from the transition to a more sustainable economy.

Both funds, originally from the company’s Sustainable Family range have been reclassified from SFDR Article 8 to 9, and adapted to fit with the company’s Article 9 framework.

Article 9 funds require 100% of fund investments, net of cash and hedging instruments, to be invested in “sustainable investments”. For an issuer to meet the company’s sustainable investment definition, it must have at least 50% of its revenues generated from activities contributing to an environmental or social objective, as measured by the EU Taxonomy, by the company’s proprietary SDG tool or through a robust strategy to decarbonize towards net zero.

In addition, as specified by SFDR, sustainable investments are required to do no significant harm and meet minimum safeguards and have good governance practices.

“These funds are supported by the further enhancement of our sustainable investing framework, including a proprietary dataset that assesses an issuer’s positive contribution to the targets and indicators of the UN Sustainable Development Goals,” says Jenn-Hui Tan, the company's chief sustainability officer. “From this foundation, we have been able to develop a series of fund solutions for clients wishing to align their investments with the transition to a sustainable economy.”

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