The European Union’s Sustainable Finance Disclosure (SFDR) presents practical challenges for US asset managers that raise capital in Europe. Malk and Debevoise have collaborated to produce a white paper on complying with the SFDR for US asset managers, particularly Article 8. The white paper details SFDR’s effects on US asset managers, including taxonomy-aligned and non-taxonomy-aligned funds.
The white paper overviews the current state of ESG programming in the US middle market, including across marketing of funds, due diligence on newly acquired portfolio companies, monitoring of existing portfolio companies, and reporting to key stakeholders, namely investors. It then summarizes SFDR requirements and provides guidance on how US asset managers with preexisting ESG programs can further augment their programs to prove out compliance with Article 8.