Fidelity International has announced it is planning to adopt the ‘sustainability focus’ label for three funds within its UK-domiciled equity fund range.
The three funds are Fidelity Sustainable UK Equity Fund, Fidelity Sustainable Global Equity Fund and Fidelity Sustainable European Equity Fund.
Together, they have total assets in excess of £865m.
Roughly 70% or more of the gross assets will invest in companies that contribute to environmental and/or social outcomes.
Fidelity’s proprietary SDG tool and the EU Taxonomy are used to establish a robust standard that the funds will be monitored and reported against under the requirements of SDR.
The main aim behind the SDR is to “improve the trust and transparency of sustainable investment products and minimise greenwashing”.
Greenwashing is defined as the act of “making people believe that your company is doing more to protect the environment than it really is”.
In July 2024, the Financial Conduct Authority (FCA) introduced four labels: sustainability mixed goals, sustainability improvers, ‘sustainability impact’ and ‘sustainability focus’.
Sustainability focus products aim to invest in assets that are environmentally and/or socially sustainable, determined using a “robust, evidence-based standard that is an absolute measure of sustainability”.
Fidelity said the labels complement its overarching Sustainable Investing Framework.
In addition, it is also reviewing opportunities for adopting other SDR labels within its fund range.
Fidelity International chief sustainability officer Jenn-Hui Tan said: “We welcome the introduction of SDR and see it as an important stage in the development of sustainable investing in the UK, giving investors greater confidence to allocate to sustainable funds.
“We believe the ‘sustainability focus’ label aligns well with the established investment approach of these funds and builds on our approach to managing SFDR Article 9 funds for European investors.
“We look forward to continue working with clients to meet their sustainable investing needs.”
In early November, Ninety One announced that it will adopt the ‘Sustainability Impact’ label on its Global Environment Fund from 1 December.
