EU Commission Proposes SFDR 2.0 Sustainable Finance Disclosure Overhaul

On November 20, 2025, the European Commission unveiled a proposal to overhaul the Sustainable Finance Disclosure Regulation (SFDR). The 'SFDR 2.0' replaces the rigid Article 6/8/9 product categories with a simpler classification system, streamlines what asset managers must report, and aims to fix well-known shortcomings of the original regime. The overhaul is expected to be negotiated through 2026.

• Simplified product classification replacing Article 6/8/9 categories
• Streamlined reporting requirements for asset managers
• Clearer sustainability labeling for financial products
• Better alignment with EU Taxonomy framework