The European Commission's Sustainable Action Plan has three objectives: (1) To reorient capital flows towards sustainable investment in order to achieve sustainable and inclusive growth; (2) To manage financial risks stemming from climate change, environmental degradation, and social issues; and (3) To foster transparency and long-termism in financial and economic activity. It is a response to recommendations from the high-level expert group on sustainable finance, which were submitted to the Commission in January 2018.
Already, the European Parliament has adopted an amendment to Regulation 2016/1011 to introduce a framework for EU climate transition and EU Paris-aligned benchmarks, an amendment to the Delegated Regulation 2017/565 to integrate environmental, social, and governance (ESG) considerations into investment advice and portfolio management, and an amendment to Delegated Regulation (EU) 2017/2359 to integrate ESG considerations and preferences into the investment advice for insurance-based investment products. It has also prepared a series of related reports, including an EU Taxonomy Regulation, benchmarks, EU green bond standard, and climate-related disclosures.
SFDR which is part of a broader legislative package under the European Commission's Sustainable Action Plan, came into effect on 10 March 2021. To meet the SFDR disclosure requirements, NOVACENE MANAGEMENT SARL identifies, assesses and, where possible and appropriate, seeks to manage sustainability risks for NOVACENE FUND as part of its risk management process. NOVACENE MANAGEMENT SARL believes that the integration of this risk analysis could help to enhance the long-term value of the portfolio for investors, in accordance with the investment objective and Investment Policy of NOVACENE FUND. However, due to the nature of the investment objective, sustainability risks are not integrated in the investment decisions.
For the avoidance of doubt, NOVACENE FUND is not promoting environmental or social characteristics within the meaning of article 8 of SFDR nor has sustainable investment as its objective within the meaning of article 9 of SFDR. For the purposes of Article 6 of the EU Taxonomy Regulation, NOVACENE MANAGEMENT SARL confirms that the investments underlying this financial product (i.e. NOVACENE FUND) do not take into account the EU criteria for environmentally sustainable economic activities.
As regards disclosures obligations under article 4(f) of SFDR it is confirmed that the NOVACENE MANAGEMENT SARL does not take into account the negative impacts due to investments - Article 4 (1) (b).
