The state of play on SFDR implementation in European private healthcare funds

The state of play on SFDR implementation in European private healthcare funds 

We are delighted to present key insights from our latest 2023 study, offering a comprehensive analysis of the current SFDR implementation status across 102 of the largest private healthcare funds in Europe, managed by 79 asset managers. This research stems from a collaborative effort with the Copenhagen Business School – MBA Programmes and our ESG Analyst, Nontawach S, whose final thesis contributed significantly to this endeavour.

Despite the inherent societal investment objective of many healthcare funds, our study reveals that there is still unlocked potential in terms of advancing transparency on sustainability and impact of private healthcare funds.

Key findings include:
💡 Approximately two-thirds of the largest healthcare funds in Europe fall into the category of Article6 funds, lacking explicit sustainability characteristics or a sustainable investment objective
💡 Article8 funds represent only 27% of the 102 healthcare funds studied, in contrast to 41% in the broader European fund landscape
💡 The classification of funds appears to be correlated to factors such as fund size, asset class, and the asset managers’ commitment to sustainability at the firm level
💡 More than one-third of Article8 and Article9 healthcare funds do not publicly disclose their sustainability characteristics, objectives, and methodologies on the asset manager websites
💡 Less than half of asset managers overseeing Article8 and Article9 healthcare funds consider the Principle Adverse Impact (‘PAI’) indicators in their investment decisions at the entity level. Notably, of the 34 Article 8 and 9 funds identified, only three have opted for PAI disclosures at the product level.

In the coming months, we will delve into the specific challenges and opportunities for European healthcare funds and asset managers in the realms of sustainability, impact and SFDR. Our objective is to unlock the potential of this crucial market segment, sharing best practices and experiences to foster positive change.

If you have insights or thoughts, we welcome your comments or feel free to reach out to us at info@raison-consulting.com