The Financial Conduct Authority’s (FCA) proposals on sustainability disclosure requirements (SDR) have been welcomed by industry experts, although concerns remain over the need for one “harmonised” and understandable system for all investment products.

The regulator previously launched a discussion paper seeking views on the proposed SDRs for asset managers and FCA-regulated asset owners, which aim to “empower” pension scheme trustees to consider climate-related factors in their decision making.

Industry organisations have welcomed the FCA’s intention behind the proposals, with Interactive Investor (II) arguing that changes to ensure investors feel empowered when choosing responsible investment products “can’t come soon enough”.

II head of pension savings, Becky O’Connor, stated: “We’ve seen huge growth in investment products focused on this area in the last few years, and the UK’s presidency of the COP26 climate conference in Glasgow last year placed greater responsibility on the shoulders of the UK finance industry to deliver more.

“However, the variety of these products and their differing strategies can be confusing and overwhelming. It can even be totally off-putting, if someone feels let down by an investment that claims to be responsible or sustainable, but on further inspection, does not seem to live up to the label. Finding information about a fund or trust’s true sustainability credentials shouldn’t be an onerous task for any investor.

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