The exponential surge in demand for sustainable investment opportunities has led to diverse approaches and inconsistent definitions of sustainability concepts and has led to a fear of “green washing” by investors and regulators alike.
Effective as of 21 March 2021, the Sustainable Finance Disclosure Regulation which comprises regulatory requirements of 2 EU Regulations (SFDR & MIFID) and 1 EU Directive IDD, encompasses the goals to prevent such greenwashing and standardise data for final investors.
As of June 1st, the EET (European ESG Template), which is the operational arm of the SFDR, is introduced on a best effort basis. This template is the first one of its kind to include as many data fields (580). The EET applies to both sustainable and non-sustainable products and, for the first time in reporting needs, will require data on underlying assets. This template will allow for machine readable ESG data which is crucial in retail and institutional investor decision making processes.
Asset Managers, Banks, Data providers, Distribution Platforms, Distributors, Service providers are all concerned by the new implementation of EET.
Among the challenges encountered by the different players in the industry are difficulties in identifying and managing one’s own data for EET and SFDR annexes including the new need to obtain data for underlying assets. Other important challenges touch on IT and operational processes such as adapting IT systems to manage the data and its flows/reporting and subsequent validation coherency with other EU templates such as the EMT V4 (necessarily registered with EET) and, the most recent evolution of including hyperlinks within the EET, for SFDR annexes. With the creation of the EET, new categories for publication are created as well.
The EET Hub from Fundsquare is our response to the challenges that are rising from these new Regulations.
With over 20 years of experience in supporting regulatory and information disclosure within the investment fund industry, Fundsquare places technology at the service of financial industry by providing secure, speedy and consistent systems to collect, manage, disseminate and maintain governance around shared data.
The Fundsquare value chain is built around a 5-step process in which collection, storage, production, dissemination and governance are optimised. Included within the 5-step process are industry specific and exhaustive checks vis a vis our referential Data Base and integrity rules to identify any potential quality issues to our clients prior to dissemination.
Our open architecture technology allows us to accept multiple formats from multiple sources via Email, SFTP, API or XML onto our proprietary E-file processing platform. Secured storage, encrypted data and consistent, automated controls reassure clients as to the accuracy of the data being processed. All data remains available via secured channels to third parties as needed.
At Fundsquare we are jurisdiction agnostic. Connected to over 250 data vendors and platforms around the world, we can send any static, dynamic data as well as documents where our clients need it to be on time.
Adding to these capacities is our innovative suite of governance and risk mitigation tools which allow clients to receive live updates on their data and reporting status via dedicated reports and online dashboards.
The EET Hub is the logical extension of our expertise working on data collection, management, and dissemination for EU driven regulation templates (ie. EMT, EPT). As official members of the Findatex Working Committee which defined the EET, we have strong technical expertise which has allowed us to develop specific controls and automation for the EET process made possible in large part due to our data base which contains the most information on investment funds for Luxembourgish domiciled funds worldwide among European ones.
Clients choosing to work with Fundsquare for their EET needs will find available a plethora of services that will simplify doing business and keeping up with mandatory regulatory changes. Our value proposition includes contained costs, quicker speed-to-market, risk mitigation & data governance, an efficient operating model and above all, the agility and availability of our client-centric teams who are known for going the extra mile to satisfy our clients’ needs.
If you are interested in finding out more how EET Hub by Fundsquare can serve your business, please contact us at community@fundsquare.net
