Statements on the Transparency of Sustainability Risk Policies and Principal Adverse Impacts




MARCH 2021


FundRock France AM (FFAM) is authorised by the Autorité des marches financiers to provide AIFM services to a range of collective investment schemes domiciled in, but not limited, to France and Luxembourg.

As per Regulation (EU) 2019/2088 (“SFDR”), FRMC is defined as a “financial market participant”.

Per article 3 of SFR a “financial market participant” shall publish information about their policies on the integration of sustainability risks in their investment decision-making process. “Sustainability risk” means an 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.

Further, per Article 4 of SFDR a “financial market participant”, where the principal adverse impacts (“PAI”) of investment decisions are considered, is required to publish and maintain on its website a “statement on due diligence policies with respect to those impacts, taking due account of their size, the nature and scale of their activities and the types of financial products they make available”. This Statement has been developed in accordance with the provisions of Article 4, while also taking into consideration Article 7 of SFDR on the transparency of PAI at product level.

Business Model

FFAM retains the portfolio management function of their funds in that circumstance appoint systematically a third=party investment advisor but can also delegates it to a qualified third party portfolio manager (the “Portfolio Manager”). Therefore, the “investment decisions” as defined under SFDR are delegated to these Portfolio Manager, subject to FFAM initial due diligence and ongoing oversight.

Integration of Sustainability Risks (Article 3 of SFDR)

The degree to which sustainability risks are or are not integrated into the investment decision making is detailed with the pre-contractual disclosures in accordance with article 6 of SFDR. This is determined at the on boarding stage of a new Funds in conjunction with the Portfolio Manager.

Integration of Consideration of PAI (Article 4 and Article 7 of SFDR)

Further, the Funds, to which FFAM act as AIFM, follow a number of different investment strategies with varying consideration of environmental, social and governance (ESG) and sustainability factors. As such, some of the Portfolio Managers may consider sustainability risks and PAI in respect of the funds for which they are appointed while other Portfolio Managers may not. Due to the different strategies and nature of the Funds under management, FFAM has determined a prudent approach to allow for both eventualities in this Article 4 SFDR Statement taking into account Article 7 of SFDR.

Selected Approach


Article 3 – Sustainability Risks

Should Portfolio Managers wish to consider sustainability risks into their investment decision in line with Article 3, FFAM ensures as part of its due diligence process and ongoing oversight that :

  1. Sustainability Risk is an integral part of the Fund’s investment process;
  2. Pre contractual disclosures are consistent with the investment objectives of the funds;
  3. Sustainability Risk is considered as part of a broader analysis of individual issuers, using internal and external inputs helping to identify exposure to Sustainability Risks, preparing for company engagement and collaborating on new research inputs based on data provided by data providers;
  4. The Portfolio Manager draws upon a wide variety of internal and external research to assess any potential impact on the value of the assets over the time horizon of the Fund.

In instances where FFAM retains portfolio management and a Financial Advisor is appointed, FFAM may consider sustainability risks within their investment decision in respect of those funds, provided that the steps described in 1-4. FFAM also acknowledge that in certain instances, the Financial advisors may publish information on their own website in respect of sustainability risks integration.

FFAM has also enhanced its existing risk management framework to oversight the integration of sustainability risks. The risk management will oversee the integration of sustainability risks by Portfolio Managers on an ex-post basis.

Articles 4 & 7 – Principal Adverse Impact 

Should Portfolio Managers wish to consider PAI in respect of the Funds in line with Article 7 of SFDR, FFAM shall ensure that:

  1. The Delegated Manager has the appropriate infrastructure in place to report on PAI on an ongoing basis;
  2. Where PAI are to be considered in respect of the Funds, the appropriate disclosures are made in the pre- contractual documents in line with SFDR by 31 December 2022;
  3. The list of Funds for which PAI are considered is available on request;
  4. The processes, systems and procedures in place to consider and report on PAI in respect of each Funds shall remain subject to the FFAM’ periodic due diligence;
  5. The Portfolio Manager also provides or published on its website appropriate disclosures in accordance with Article 4(1) and (2) of SFDR, while also considering the associated Regulatory Technical Standards once adopted by the European Commission, in respect of the Funds;
  6. The periodic reports of the Funds contain sufficient and appropriate information as to the assessment of PAI.

Where PAI are not considered in respect of the Funds to which FFAM act, FFAM shall ensure appropriate disclosures are contained within the relevant pre-contractual documents. For further information as to why PAI are not considered in respect of a particular Funds, please refer to the prospectus/supplement of that Funds.

In  instances  where  FFAM  retains  portfolio  management,  FFAM may consider PAI in respect of those funds, provided that the steps described in 1 to 6 of the above are carried out in an equivalent manner with appropriate disclosures made on this website or made available. FFAM also acknowledge that in certain instances, the Portfolio Managers may publish information on their own website in respect of PAI in respect of the Funds.

This position shall remain subject to ongoing review in line with market practise and regulatory developments. FFAM shall periodically reassess the integration of sustainability risks, PAI statements, policies adopted by the Portfolio Managers and reporting made in respect of the Funds to ensure their continued appropriateness. This Statement is subject at least to annual review.

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