European Microfinance Platform
e-MFP
e-MFP is a network of around 120 members from all regions of the world working in financial inclusion.
ID: 434726592314-64
Lobbying Activity
Response to Revision of EU rules on sustainable finance disclosure
28 May 2025
e-MFP and Cerise+SPTF, financial inclusion networks representing social- and impact-finance actors investing in emerging markets, welcome the revision of the Sustainable Finance Disclosure Regulation (SFDR). We view SFDR 2.0 as an opportunity for the EU to both strengthen internal market competitiveness and build a global safe harbour for capital that pursues environmental and social impact alongside financial return. To achieve this, the framework must work for all investors wherever they operate, rather than inadvertently discourage capital flows to emerging markets. With this aim, we highlight four recommendations. 1) The definition of sustainable investment in Article 2(17) should stay open and flexible but refined so that it works in a global context and aligns with best practices in the impact investing field. It should explicitly recognise sustainable economic development as part of environmental and social objectives; emphasise ex-ante intentionality, measurement and reporting; define transition-finance and recognise use-of-proceeds investments aimed at decarbonising hard-to-abate sectors; and treat good governance as an evolving concept benchmarked to international norms instead of four rigid categories, that lets investors drive improvements over time. 2) Proportionality and international interoperability must be built into the link between SFDR and the EU Taxonomy to address the data gaps and compliance hurdles non-EU investments face due to today' s EU-centric rules. We urge the Commission to recognise proxy methodologies and estimates supported by EU-approved guidance and tools for non-EU investees; allow the use of recognised international standards (e.g. IFC Performance Standards) or equivalent national legislation to meet DNSH criteria, and mandate guidance through a dedicated expert group on global investment contexts (see point 4). 3) Transparency should be delivered through a simple, comparable product-categorisation scheme that reflects the degree to which sustainability is incorporated in the investment strategy. To back this system, and as suggested by the ESAS in their joint opinion, we welcome a single mandatory sustainability indicator implemented via an alphabetical scale rather than time-limited labels (todays sustainable may be tomorrows transition). This grading system would automatically capture transition paths and let funds move upward as they become more sustainable, while mandatory disclosure of a limited core set of indicators for every product would ensure a level playing field and preserve comparability for retail investors. 4) The revised framework should establish an Expert Group on Emerging Market Investments (EGEMI) to ensure the international applicability of SFDR while avoiding undue burdens on smaller actors. Chaired by the Commission and including EU agencies and authorities, development banks, private-sector experts, civil-society representatives and academics, EGEMI would advise the Commission and ESAs on use of proxies and measures to improve data quantity and quality as well as interoperability with global frameworks and local regulations. These four recommendations will maintain the ambition of the original SFDR while cutting unnecessary complexity, safeguard the global relevance of EU rules, and accelerate the flow of private capital toward markets and communities where it is most urgently needed. They will also consolidate Europes role as a reliable safe haven for sustainable finance at a time of global uncertainty. e-MFP and Cerise+SPTF remain committed to working with EU policymakers and fellow stakeholders to translate these recommendations into detailed legislative text and technical standards, and deliver a coherent, inclusive and ambitious SFDR.
Read full responseResponse to Taxonomy Delegated Acts – amendments to make reporting simpler and more cost-effective for companies
25 Mar 2025
The EU Commission has acknowledged that the international interoperability of the Do No Significant Harm (DNSH) principle poses a well-known challenge in the implementation of the Taxonomy Regulation. However, as part of its so-called Omnibus reform package and, in particular, the EU Commission Delegated Regulations amending Commission Delegated Regulations 2021/2178, 2021/2139 and 2023/2486, supplementing the Taxonomy Regulation, it has failed to address key international interoperability challenges in the application of the technical screening criteria to assess (i) substantial contribution and (ii) DSNH. By doing so, it has failed to take note of the Platform for Sustainable Finances recommendations to simplify the application of DNSH criteria and the current amendments (e.g. to Appendix C of Regulation 2021/2139) are deemed insufficient. Whereas: (i) The Taxonomy Regulation contains no hard prescription to only use said Union acts and criteria; (ii) Keeping the current EU-centric text is gravely impeding the implementation by financial market participants operating/investing outside of the EU, and in particular in Emerging Markets (EM); (iii) Even with such recourse to international frameworks it remains extremely challenging for third-country investees to be taxonomy aligned, a challenge that should, where possible, be alleviated with mechanisms (see file attached) for the Taxonomy Regulation to meet its objective and EU actors to be able to truly reorient capital flows to environmentally sustainable activities/investments where they are most needed. (iv) It is worth remembering that the taxonomy remains a much more stringent regime than other internationally recognized best standards, such as MDBs Common Principles for Climate Finance tracking or CBIs taxonomies (used for green bonds). The overall call or recourse to EU regulations envisaged in the Taxonomy Regulation and its delegated regulations needs to be amended so that that in situations involving investments/activities outside of the EU, it will not impede recourse to international frameworks and standards and thus ensure effective international interoperability of the Taxonomy Regulation. In the attached file, e-MFP and Cerise+SPTF propose additional changes to the ones proposed in the Commissions draft for the Taxonomy to work and be implemented adequately in an international context. e-MFP is a network of over 115 members working in microfinance and financial inclusion worldwide. Cerise+SPTF is the worldwide global inclusive finance network created in 2005 to advance social and environmental performance management.
Read full responseMeeting with Vincent Hurkens (Cabinet of Executive Vice-President Stéphane Séjourné) and Triodos Bank and Regulatory Communication
18 Feb 2025 · Omnibus sustainability simplification, Savings and Investments Union