Global Trustee and Fiduciary Services Bite-Sized Issue 3 | 2026

8 QUICK LINKS AI DIGITAL ASSETS EMIR FINTECH FSB IOSCO MIFID II/MIFIR SUSTAINABLE FINANCE/ESG ASIA PACIFIC EUROPE LUXEMBOURG NORTH AMERICA UNITED KINGDOM Global Trustee and Fiduciary Services Bite-Sized | Issue 3 | 2026 – That the disclosures outline potential negative outcomes from this investment approach; – That a scoring system that classifies assets as sustainable if they score 7 out of 10 includes a description of the criteria that assets would need to meet or attributes that they would need to have to get that score; and – Where a fund has a sustainability objective to invest in products/services across several themes, it uses KPIs that show how the fund is invested across those themes. • Then as regards poor practice, the FCA identifies examples where: – The objective is not clear, specific, and measurable; – A company is selected based on some sustainable attributes without considering the complete picture; – The standard of sustainability is not backed by evidence; and – The firm claims that 100% of the company’s revenues is derived from sustainability products/ services but cannot substantiate that claim. Sustainability Improver Label • Good practice examples provided by the FCA include where: – The disclosure sets out how the firm intends to measure an outcome in relation to an objective; – The firm decides which assets have the potential to meet the standard based on disclosures, clear strategies, transition plans and so on; and – KPIs show decarbonisation where the fund’s sustainability objective is to invest in assets with the potential to decarbonise. • Whereas poor practice examples provided by the FCA include where: – A fund has a climate-related objective that is only based on reducing Scope 1 and 2 emissions, but gives the impression that the aim is to reduce ‘all’ emissions (including Scope 3); – The firm assumes that assets will set decarbonisation targets, without any robust evidence to support this; and – Firms continue to engage with companies that aren’t making progress towards the objective, with no timeframe for them to respond to the engagement, or next steps if they don’t. Sustainability Impact label • Good practice examples provided by the FCA include where: – The outcomes are clear in each of the areas of intended impact; – A fund’s assets aim to provide the general population with access to education, and the firm clearly sets out what change it expects; and – The firmmeasures how the companies respond to this engagement. • Then examples of poor practice identified by the FCA include where: – The fund seeks broad or unmeasurable impacts; – The KPIs are not consistent with the objective and theory of change; and – The firm does not clarify what change it expects by investing the relevant assets or why.