Background
In March 2018, the European Commission published the EU Action Plan on sustainable finance (Action Plan), implementing the Paris Agreement on climate change and the UN’s 2030 Agenda for Sustainable Development. As part of this Action Plan, the Regulation (EU) 2019/2088 on sustainability‐related disclosures in the financial services sector (SFDR) was published. SFDR lays down harmonized rules for financial market participants (entities that provide financial products or services such as portfolio management service) and financial advisers (entities that provide investment or insurance advice) on transparency with regard to the integration of sustainability risks and the consideration of adverse sustainability impacts in their processes and the provision of sustainability‐related information with respect to financial products or services.
Definitions
To ensure a better understanding of the information presented below, we provide the following definitions in accordance with SFDR:
- Sustainability Risks: Environmental, social or governance events or conditions that, if they occur, could cause an actual or a potential material negative impact on the value of an investment;
- Sustainability Factors: Environmental, social and employee matters, respect for human rights, anti‐corruption and anti‐bribery matters;
- Principal Adverse Impacts (PAIs): The impacts of investment decisions and advice that result in negative effects on sustainability factors.
Eurobank S.A. SFDR Disclosures
Eurobank SA as a credit institution that provides portfolio management and investment advice services provides the required information in accordance with SFDR regarding:
- The integration of sustainability risks into the investment decision‐making process and investment advice (art. 3 SFDR);
- A statement on due diligence policies with respect to PAIs (art. 4 SFDR);
- Information regarding the integration of sustainability risks in its remuneration policy (art. 5 SFDR).
Article 3: Sustainability risk policies
Whilst the Bank does not currently apply an overarching formal policy regarding the integration of sustainability risks in the investment decision‐making and advisory processes, it still takes sustainability risks into account through the following:
- Environmental & Social assessment (ESMS) for new clients and new financings.
- Exclusionary policies with clearly defined exclusion criteria
- The Bank’s Sustainable Investment Framework which outlines the potential sustainable investment approaches/strategies, the selection of eligible investments and the monitoring frequency of the sustainable portfolio.
The Bank has not fully integrated sustainability risks into its investment decision‐making and advisory processes since it has outsourced investment advice and portfolio management services to Eurobank Asset Management MFMC which is the investment arm of the Eurobank Group. Thus, due diligence, research and investment decision processes when selecting or recommending financial instruments are conducted based on Eurobank Asset Management MFMC’s Responsible Investment Policy.
Article 4: Principal Adverse Impacts (PAIs)
The Bank has outsourced its portfolio management and investment advice services to Eurobank Asset Management MFMC which is the investment arm of the Eurobank Group. Consideration of Principal Adverse Impact (PAIs) is performed in accordance with Eurobank Asset Management MFMC’s policies and is described in the Principal Adverse Impact Statement.
Article 5: Remuneration policies
The Bank has established a Remuneration Policy that is applicable to all Bank employees and covers their total remuneration. The Remuneration Policy forms an integral part of the Bank’s corporate governance practice. The Remuneration Policy promotes sound and effective risk management and is consistent with the objectives of the Bank’s business and risk strategy, corporate culture and values, risk culture, including with regard to environmental, social and governance (ESG) risk factors, long term interests of the Bank and the measures used to avoid conflicts of interest and should not encourage excessive risk-taking on behalf of the Bank.
Currently, the Remuneration Policy is not linked to specific sustainability performance indicators, however the Bank may introduce such elements in the future.
For further information on our investment services and products please refer to the Eurobank’s Private Banking webpage.