Investing sustainably

Sustainability disclosure requirements

The FCA’s Sustainability Disclosure Requirements (SDR) make it easier for investors to compare the sustainability characteristics of different funds and make informed decisions about where they want to invest their money.

What is SDR?

The Sustainability Disclosure Requirements (SDR) for fund managers was introduced by the Financial Conduct Authority (FCA) in 2024.

They aim to improve the trust and transparency of sustainable investment products and address concerns about ‘greenwashing’ – the practice of making financial products look more environmentally friendly than they are by using misleading language and branding.

The regulations mean that asset management companies have to provide better information for investors on how their money is being managed in terms of sustainability. This includes things like:

  • How investment managers consider the environment or society when they invest
  • What industries investment managers avoid investing in to reduce environmental or social harm
  • What investment managers are doing to encourage the companies they invest in to do better for society or the planet.

Key features of SDR

Rules on fund names and marketing

All communications must be fair, clear and not misleading to help investors find products with genuine sustainability characteristics.

Consistent reporting standards

To make it easier to compare funds from different providers.

Fund labels

Identify products that have specific sustainability objectives to help investors find products aligned with their needs.

BNPP AM’s labelled funds

Source: BNPP AM as at 31 December 2025

7

BNPP AM UK funds have adopted labels

17.5%

Of our UK-domiciled assets under management are held in labelled funds

Our labelled funds

Our existing expertise means we have been able to adopt labels for a number of our funds.

Sustainability Improvers – AXA UK Sustainability Equity Fund, AXA Global Sustainable Managed Fund, AXA Carbon Transition Sterling Buy & Maintain Credit Fund, AXA Carbon Transition Global Short Duration Bond Fund, AXA Carbon Transition Global Core Credit Fund.

Sustainability Impact – AXA People and Planet Equity Fund, AXA Green Short Duration Bond Fund.

  • Sustainability improvers
  • Sustainability impact

Find out more about impact and carbon transition investing

Our impact strategies

Learn more

Our Fixed Income Carbon Transition Strategies

Learn more

Annual sustainability reports

Under SDR, fund managers are required to publish a report for all funds that have an ESG component to their investment process or a sustainability goal. This report comes in a standardised format intended to make it easier for investors to compare the sustainability credentials of fund managers.

We have created SDR Consumer Facing Documents (CFD) for all our relevant funds, including those that haven’t adopted an SDR label. You can find these reports on our Fund Centre with the other documents, like the Prospectus and Key Investor Information Document (KIID).

Find SDR Consumer Facing Documents on our Fund Centre.

AXA IM’s annual sustainability report

Fund managers are also required to report on the sustainability performance of the overall investments. Our annual Sustainability Report includes required reporting for both the SDR regulations and the Task Force on Climate-related Financial Disclosures  (TCFD).

The first combined report was published in 2025

Sustainability Report
Download Icon

Investment risks

Fund-specific risk factors 

AXA Carbon Transition Global Short Duration Fund 

  • Carbon transition risk 
  • Credit risk 
  • ESG risk 
  • Interest rate risk 
  • Prepayment and extension risk 
  • Index-linked bonds risk 
  • High yield bonds risk 
  • Risks linked to investment in sovereign debt 
  • Emerging Markets riskStock lending risk 

AXA Carbon Transition Sterling Buy And Maintain Credit Fund 

  • ESG risk 
  • Carbon transition risk 
  • Credit risk 
  • Interest Rate risk 

AXA Carbon Transition Core Credit Fund 

  • Counterparty Risk 
  • Interest Rate Risk 
  • Liquidity Risk 
  • Credit Risk 
  • Carbon transition risk 

AXA Global Sustainable Managed Fund 

  • Equity risk 
  • ESG risk 
  • Currency risk 
  • Emerging Markets risk 
  • Interest rate risk 
  • Risks linked to investment in sovereign debt 
  • Stock lending risk 

AXA UK Sustainable Equity Fund 

  • Equity risk 
  • ESG risk 
  • Stock lending risk 

AXA People & Planet Equity Fund 

  • Equity risk 
  • ESG risk 
  • Concentration risk 
  • Currency risk 
  • Emerging Markets risk 
  • Industry sector risk 
  • UN SDG alignment risk 
  • Smaller companies risk 
  • Stock lending risk 

AXA Green Short Duration Bond Fund  

  • ESG risk 
  • Credit risk 
  • Interest Rate risk 
  • Prepayment and extension risk 
  • Index-linked bonds risk 
  • High yield bonds risk 
  • Risks linked to investment in sovereign debt 
  • Emerging Markets risk 
  • Stock lending risk 
  • Liquidity risk 
  • Counterparty risk 
  • Currency risk  

Get in touch

Got a question? Our team is happy to help

Contact us

Important information

Marketing communication. For professional investors only.

This document is directed only at person(s) who have professional experience in matters relating to investments (“relevant persons”). Any investment or investment activity to which this document relates is available only to and will be engaged in only with Professional Clients as defined in the rules of the Financial Conduct Authority. Any person who is not a relevant person should not act or rely on this document or any of its contents.

Past performance or achievement is not indicative of current or future performance. Performance is calculated net of fees unless otherwise stated.

Any views expressed here are those of the author as of the date of publication, based on available information, and subject to change without notice. This material does not constitute investment advice.

Investments are subject to market fluctuations and the risks inherent in investments in securities. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial investment. There is no guarantee that the performance objective will be achieved.

Investing in emerging markets, or specialised or restricted sectors is likely to be subject to a higher-than-average volatility due to a high degree of concentration, greater uncertainty because less information is available, there is less liquidity or due to greater sensitivity to changes in market conditions (social, political and economic conditions).

Environmental, social and governance (ESG) investment risk: The lack of common or harmonised definitions and labels integrating ESG and sustainability criteria at EU level may result in different approaches by managers when setting ESG objectives. This also means that it may be difficult to compare strategies integrating ESG and sustainability criteria to the extent that the selection and weightings applied to select investments may be based on metrics that may share the same name but have different underlying meanings. In evaluating a security based on the ESG and sustainability criteria, the Investment Manager may also use data sources provided by external ESG research providers. Given the evolving nature of ESG, these data sources may for the time being be incomplete, inaccurate or unavailable. Applying responsible business conduct standards in the investment process may lead to the exclusion of securities of certain issuers. Consequently, (the Sub-Fund’s) performance may at times be better or worse than the performance of relatable funds that do not apply such standards.

This is not an exhaustive list of risks.  For a complete description and definition of risks, please consult a client relationship manager or the global BNP Paribas Asset Management website: staging.bnpparibas-am.co.uk.