On March 1, the ISR label – socially responsible investment – awarded to sustainable investments underwent a major overhaul. Among the notable points, the new framework now requires managers to make exclusions in their funds, particularly companies operating in fossil fuels. However, 1 in 2 products have such players in their portfolio. Other elements also have an impact. Therefore, SRI-labelled media must now analyze the climate transition plans of the companies they hold. “Most financial players go through private data providers, who do not have all the necessary information. They must therefore carry out internal audits to be able to gauge the plans in question: a headache, both logistical and and methodological”, we point out to the company WeeFin.
Until now, only new labeling requests had to meet these criteria. But from January 1, 2025, all funds will have to comply to keep the label. To date, 1,278 media have it, but a significant proportion of them could decide to do without it to avoid these new constraints. This is particularly true in small management companies where these represent significant additional costs. Another problem: the reduction in the investment universe, which risks disrupting the strategy implemented by managers. The biggest players may only maintain a limited range of SRI funds. Evil for good?