EBF Strongly Supports the Efforts to Reduce the Complexity and Increase the Usability of Sustainability-Related Disclosures for Capital Markets

Brussels, 27 February 2026 - The European Banking Federation strongly supports the European Commission's efforts to reduce the complexity of sustainability-related disclosures for capital markets and increase their usability for both investors and financial market participants.

We believe the proposal takes important steps towards a clearer, more cost-effective, usable and coherent system, and we support the introduction of clearer product classification through three categories, including the flexibility afforded to financial market participants in meeting the binding criteria of the categories, the overhaul of the disclosure system, focusing on what is more meaningful for retail investors, and the deletion of portfolio management services from the SFDR scope.

We call on co-legislators to preserve the overall balanced and retail-oriented approach proposed by the Commission, while making targeted improvements and clarifications across all regulatory levels to ensure the revision attains its objectives.

Our key messages:

1. Address issues related to ESG products and instruments not in scope of the revised SFDR proposal, in particular:
   • Apply the MiFID/IDD sustainability preferences framework not only to SFDR products but to all 'financial instruments' and 'financial services' (including portfolio management and investment advice) under MiFID II.
   • Significantly simplify the sustainability preferences advisory process in order to promote clients' understanding and adoption.
   • Allow sustainability disclosures in PRIIPS for non-SFDR products to ensure coherent information for investors.
   • Ensure coherence between SFDR 2.0 and sustainability-related elements of MiFID, IDD and PRIIPs, including coherent implementation of amendments and transition periods.
2. Ensure timely implementation of SFDR 2.0, with coherence between L1 and L2 implementation, while allowing for the immediate removal of deleted parts as soon as the Regulation takes effect.
3. Meaningfully integrate general-purpose sovereign bonds into the Transition and Sustainable categories by allowing credible methodologies, rather than excluding them completely from these categories.
4. Ensure clearer treatment of the use-of-proceeds instruments aligned with credible market standards (such as ICMA's Principles), given their widespread use and importance for international market interoperability.
5. To strengthen transparency and ensure high-quality estimates essential for preventing greenwashing:
   • Consider setting out requirements to which ESG data providers that fall outside the scope of the ESG Ratings Regulation but modify raw ESG data in any manner would be subject, following a thorough impact assessment.
   • At least, envisage a code of conduct for such data providers in the EU, improving the transparency and robustness of methodology.
6. Withdraw the ESMA fund-naming guidelines to avoid overlaps and inconsistencies with the new SFDR categorisation.