PensionsEurope supports the European Commission’s objective to simplify SFDR 2.0, but cautions that the proposed categorisation system is structurally misaligned with occupational pensions. Unlike retail product manufacturers, Institutions for Occupational Retirement Provision (IORPs) are long-term institutional investors and customers of financial products, operating under fiduciary duty and liability-driven investment strategies. Their diversified portfolios, including sovereign bonds for risk management, would systematically exclude them from sustainability categories under a retail-focused framework, creating misleading outcomes and disproportionate compliance costs.
PensionsEurope therefore advocates that Member States have discretion to exempt IORPs from mandatory categorisation. If inclusion proceeds, a dedicated IORP-specific regulatory technical standard (RTS) is essential, reflecting collective investment structures, long-term horizons, and the prudent person principle. Key technical adjustments must include: ensuring an adequate approach for the treatment of government bonds; avoiding double application of the 70% alignment threshold; protecting member communication channels on sustainability matters; ensuring proportionality in ESG data supervision; and maintaining full consistency with the IORP II Directive, CSRD, ESRS, and EU Omnibus simplification package.
