The Zero Risk Fund Approach

In August 2005, the European Commission (EC) started the sfdr mandatory indicators Zero Risk Fund approach in order to provide significant reforms in existing wasteful and predatory pricing schemes. The main goal of the Zero Risk Fund approach is to introduce full transparency in the fund raising and investment processing processes at the European and local level, without unnecessarily increasing costs and without Disclosure obligation of the various risk-weighted products.

Over the next four years, the participating public bodies (e.g. EU and Local Investment companies) are mandated (by the Commission) sfdr mandatory indicators  to disclose their various significant risks (as defined in the basis document spouse Monster wing I B of the Final Dealing Approach mandated by the EC). In addition, agencies should also have their internal sustainability services confirmed and made mandatory.

However, in the light of recent history there are strong reservations about the suitability of SFDR reforms. Among the key risks are:

· Unintended regulatory sfdr mandatory indicators burden of adopting SFDR and implementing the schemes. This is especially important for companies that are not sufficiently big enough to have significant distortions at the moment of implementation, or already entered into some form of obliged underwriting or supplementation schemes, or for companies with substantial business lines (e.g. banks). In the case of investment firms with subsidiaries, a significant measure of the corporate value can be lost.

· Substantial costs of implementing an SFDR sfdr mandatory indicators scheme. Article 100 of Commission Decision 2005/65/ Houses encoded to the calculation of the costs incurred, in compliance with internal auditing policies.

In light of these arguments, the question arises: Should Commission implement the scheme accredited by the European Commission without significantly improving its Guidelines?

This depends on several factors. Firstly, Commission should consider the costs to households (with access to smaller). Secondly, the scheme needs to take into account the spectrum of profitability of the range of EU-financing products, in which SFDR seems to have found some affinity (as expressed in some of the sfdr mandatory indicators  comments submitted by the Commission and Financial Services Commission, respectively). The implementation costs should be modest, as companies will have to pay for the costs incurred.

Nevertheless, the Commission should:

>> Review the underlying objectives

>> Find out how the risk-weighted approach is causing an unnecessary additional burden on regulated entities and taxpayers

>> Understand the possible adverse effects of an SFDR on other objectives at the same time as taking account of the additional risks, and the impact of the sfdr mandatory indicators on other important safeguards.

>> Make sure that the adoption of the SFDR scheme and its use does not undermine other regulations.

E. Financial institutions and retail customers

Financial institutions have a huge amount of leverage relative to their capital positions. This means that they can borrow huge amounts of money relative to their capital resources. Many banks have increased their investment in endangered collateral, as shown in such a case (see, in detail, "The derivative sale: renegotiating the German recapitalisation package"). This has', in addition to the effects described above, affected the sfdr mandatory indicators class of borrowers and types of products in one of the many banks in action.

The exercise of supervision over banks is, therefore, important and a minefield. Because of the huge size of the structures at the moment, not to say that they are inefficient, they tend to have a lot of problems. Not only do they generally have serious problems in terms of internal efficiency, but the sfdr mandatory indicators are often exposed to a high degree of political interference by numerous political figures. This can lead to various ways of getting at least part of their capital back. This happens through banks having to buy another bank's shares or other investments. Or guarantees can be introduced, effectively lending out the bank's capital.

The public enterprises are regulated but not supervision or provision of insurance or safety nets. These activities are left largely in the hands of private owners and management. In fact, all sorts of financial transactions directly or indirectly touch their operations. They cannot be expected to be especially alert about sfdr mandatory indicators situations that might lead to the sapping of their capital.