Fully excluding new fossil fuel projects from the revised Sustainable Finance Disclosure Regulation (SFDR) is critical to achieving the EU’s climate commitments, safeguarding the integrity of the framework, and strengthening investor confidence, warn 133 organisations and experts in a new multi-stakeholder letter.
The joint letter, signed by civil society organisations, financial institutions, academics, and experts, urges the European Parliament and EU Member States to ensure that all funds falling under the three SFDR voluntary sustainable product categories consistently exclude companies developing new fossil fuel projects. Yet, the proposal presented by the European Commission in November falls short of this as it limits the exclusions to two categories.
While presenting the Draghi report in September of 2024, European Commission President Ursula von der Leyen stated that “the only way to ensure our long-term competitiveness is to shift away from fossil fuels and towards a clean, competitive, and circular economy”. As both Member States and the European Parliament are now expected to adopt their respective position in the coming months, the signatories call on EU co-legislators to create a final SFDR framework that is coherent and credible, leaving no room for provisions that would undermine its objectives.
Open letter: Avoid fossil fuel greenwashing in EU funds
In the context of the review of the Sustainable Finance Disclosure Regulation (SFDR), the 133 signatories of this letter call on to ensure all funds commercialized in the EU that claim to be in the “ESG basics”, “transition” or “sustainable” categories exclude companies developing new fossil fuel projects (“fossil fuel developers”).