Gaëtan Parchliniak of Fundrock speaks at the Association of the Luxembourg Fund Industry’s upcoming European Asset Management Conference. Photo: Apex Group

Gaëtan Parchliniak of Fundrock speaks at the Association of the Luxembourg Fund Industry’s upcoming European Asset Management Conference. Photo: Apex Group

The Association of the Luxembourg Fund Industry holds its European Asset Management Conference on 21-22 March 2023.

In advance of the event, Delano connected with Gaëtan Parchliniak, head of regulatory affairs at Fundrock. He speaks on the “From acronyms to ESG compliance or greenwashing?” panel, at 4:40pm.

Aaron Grunwald: What do you want the audience to get most from the “From acronyms to ESG compliance or greenwashing?” session?

Gaëtan Parchliniak: I hope that the session will help the audience to better understand where the potential challenges relating to ESG may emerge, and also the opportunities ESG can present for their business. Hopefully, they will also better understand the value of partnering with a trusted third party such as Fundrock and specialists from the wider Apex Group to help to address and overcome potential challenges.

From your point of view, what are the most challenging ESG compliance or greenwashing issues that fund firms face this year?

As ESG has proliferated in our industry, there have been a number of ESG compliance challenges, and the emergence of “greenwashing” accusations. Some of the ESG compliance challenges faced by funds include: the lack of consistent, harmonised and verified ESG data, unclear definitions or confusion around ESG terminology, a constantly evolving reporting template and regulatory landscape, ongoing European and domestic Q&As as well as the emergence of new guidelines.

For instance, it is almost impossible to compare SFDR article 8 funds ESG characteristics with another article 8 fund due to the variety of investment strategies and characteristics that have been considered--exclusion list, best in class, proprietary method, etc. When investors, LPs or sponsors require an article 8 fund, it means only that we will have to provide reporting according to the SFDR template. It is sometime frustrating to limit the ESG topic to reporting consideration.


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Regarding the lack of data, the situation is likely to improved slowly following the entry to application of CSRD but will still be challenging, especially for entities that are not cover by CSRD like SMEs. It means that for venture capital or private equity investors to comply with the disclosure requirements, access to specialist ESG data analysts is essential. Just last month, Apex Group launched the first verified ESG benchmarking database for the private markets including datapoints from more than 400 GPs, 1,500 portfolio companies in more than 45 countries.

Startup companies are not always able to provide on day 1, at the time of investment, sufficient data or commitment to the fund and to provide ongoing data especially when this was not contractually planned. Even if it was planned, what will you do if the SME does not provide the information or not make the progress expected in term of ESG? We are not in the world of liquid assets, selling the assets could not be in the best interest of the investors. More flexibility should be incorporated in SFDR in order to accompanied company/start up that need to make progress or are in transitional or startup phase.

How important is greenwashing risks to asset managers?

2022 was characterised with a more thorough examination of its application to the financial services industry. Managers have become more cautious, nervous of being accused of ‘green’ and ‘purpose-washing’ their investment portfolios--with the main risk being reputational. Furthermore, the fear of regulatory non-compliance, and the specialist knowledge and understanding required to adhere to new rules, is driving many to seek external support. These factors have precipitated a dramatic shift over the last 12 months, from a reliance on unverified, in-house ESG data reporting to the need for independently evaluated and authenticated reporting, especially in areas such as carbon footprint calculation.


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Companies have realised that taking short cuts when it comes to ESG reporting will not deliver meaningful outcomes. As a result, more investment managers than ever are outsourcing their ESG needs, as the complexities of data collection become clear, with many understanding that ‘marking their own homework’ in this regard, will only invite further scrutiny. Driven by institutional investor pressure, in 2023 regulators will continue to crack down on greenwashing, calling out those businesses which spend more effort marketing themselves as ESG-aligned than actually delivering positive impacts.

Aside from your own talk at the Alfi event, which session are you most looking forward to hearing, and why?

I am very much looking forward to the interview with the director of CSSF Marco Zwick [editor’s note: Wednesday 22 March at 3:50pm]. It is always interesting to have the opportunity to hear directly from the supervisor.