Sustainable Finance Disclosure Regulation
Integration of Sustainability Risks and Assessment of the Impact on Likely Returns
The impact of sustainability risks on the returns of the financial products have been assessed by LHP Ireland Fund Management Limited and having considered the composition of the assets of the portfolios and the objective and policies of the financial products, it has been determined the impact of sustainability risks are not materially relevant to the returns of the financial products. For that reason, sustainability risks are not integrated into investment decisions for the financial products.(1)
Consideration of Principal Adverse Impacts
LHP Ireland Fund Management Limited does not currently consider the principal adverse impacts of its investment decisions on sustainability factors in accordance with the Taxonomy Regulation.(2,3) The rationale for not considering such adverse impacts is on the basis that the regulatory technical standards which will set out the content, methodology and information required in the principle adverse impact statement remain in draft form and the level two regulatory technical standards (the ''RTS''), which supplements the Sustainable Finance Disclosure Regulation, has not yet come into effect.(4) LHP Ireland Fund Management Limited intends to make a decision on whether it will consider the principal adverse impacts of investment decisions on sustainability factors once the RTS come into effect.
LHP Ireland Fund Management Limited's remuneration policies (i) promote sound and effective risk management and (ii) discourage excessive risk taking. LHP Ireland Fund Management does not integrate sustainability risks in its remuneration policies as it has determined that sustainability risks do not have a material impact on its remuneration policy.
(1) 'sustainability risks' means environmental, social or governance event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of an investment, including but not limited to, risks stemming from climate change, natural resource depletion, environmental degradation, human rights abuses, bribery, corruption and social and employee matters.
(2) ‘sustainability factors’ mean environmental, social and employee matters, respect for human rights, anti‐corruption and anti‐bribery matters.
(3) 'Taxonomy Regulation' means Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment and amending Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector.
(4) 'Sustainable Finance Disclosure Regulation' means Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector.