Hello, I'm Jonathan Boyd on behalf of Funds Europe. I have over two decades of journalist and editor experience covering financial institutions markets, and asset management. I'm pleased to have with me Paul Poletti-Gadd, Chief Solutions Officer at Broadridge Fund Communication Solutions. Hi, Paul. It's great to have you here to discuss developments around the European ESG template or EET.

Hi Jonathan, it's great to be with you, even if we're not quite together in person. If you don’t mind, I’d quickly like to remind everyone who Broadridge are. So, we're a global FinTech leader with some $5 billion in revenues, part of the S&P 500 with over five decades of experience. As part of Broadridge, Fund Communication Solutions supports the investment industry by providing a suite of services supporting data, documents and regulatory reporting across the lifecycle of funds.

According to FinDatEx, the financial data exchange set up by trade associations representing various parts of the financial sector including asset management, and which has been involved in developing the template the EET is quote, “Meant to facilitate the necessary exchange of data between product manufacturer and distributor for the purpose of fulfilling ESG related regulatory requirements contained in the SFDR, relevant provisions of the Taxonomy Regulation, and the relevant delegated acts complimenting MIFiD II and IDD” end quote. Now, putting aside the acronyms and the long sentences, it seems to come down to two factors: timing and scope. Can you remind us of what timings are involved here and what asset managers need to consider in responding to the EET requirements?

Easy for you to say, isn’t it; lots of acronyms lots of long sentences. But it may be worth giving a little bit of history. FinDatEx have created many templates including the EMT the European MIFiD Template, the EPT, the European PRIIPs Template, the latest template, the EET or European ESG Template. As you mentioned this is designed to facilitating the exchange of ESG related information. The public consultation on the EET completed only in March and gave the 1st of June as the date of the first publication reports, so it's no surprise that the industry is struggling to be ready. And the EET is a big one; some 580 data points covering six main areas. The first area is information in relation to the dataset contained in the EET. The second covers the manufacturer. The third section covers product or instrument information. The biggest section by far, some 358 potential fields, is on Principle Adverse Indicators, or PAIs. There are some screening fields and finally some country specific fields. What we've seen is a buildup in the amount of data available for completion. The effective dates in the summer of MIFiD II and the IDD delegated acts both require additional information, and ultimately clients will be providing full details on the Principle Adverse Indicators, as well as details on a wide variety of information, including carbon footprint, negative effects on biodiversity, and gender diversity across their boards.

And how has Broadridge responded to the EET? Broadridge has been looking at ESG in general for a very long time. As a topic, it covers the whole industry that we support, as it covers every industry. In relation to EETs, Broadridge has developed a complete end-to-end service solution, for the production and distribution of the template, utilizing our single platform, clients can send us their relevant data in their own formats, and we will validate and control that data before generating the FinDatEx EET template for their approval and onward distribution. Equally, if clients produce their own EETs Broadridge will provide distribution support. Again, on receipt of the template we will perform various controls and validations and thus ensure the data in the distribution market is both accurate and consistent.

Now, I understand you run regular working groups with clients, which allows their input into the EET solution. Can you explain for us how that works in practice?

Working groups are great. We host them across all of our services in general, but they become particularly valuable around new regulations or new services. Firstly, they're a fantastic forum for knowledge sharing, both from our clients to us, but also for our clients in a peer-to-peer environment, because often they're invariably facing the same issues and the same concerns. During our sessions. We provide including overlays regarding our timelines, plans and service offerings, and a number of the group often provide valuable input and feedback on our plans and design for the service. An interesting example specific to EET has been client readiness. We already touched upon that and the struggles that clients are having to get their data ready. In particular concerns were raised around making information available in the EET prior to changes being made in their portfolios. As a result of the feedback on readiness, we were able to relax certain validation rules in the system to support the admission of certain information. Additionally, we work with a number of experts across the industry, and we often have guest speakers to cover areas of particular interest to our clients How does your EET solution sit alongside the other solutions that you offer?

This is the great part. EET is such a natural extension of our service suite. We have well over a decade of experience in supporting the industry through UCITS KIIDs, EMTs, EPTs, TPT. The list goes on. And as I'm sure you're aware, just at the same time as SFDR reporting kicking in, we'll also be transitioning all of our clients to the PRIIPs KID as well. This is all business as usual for us. As we work in a single data platform EET simply becomes the next regulatory supported template to build from the same core data set. Obviously, the ESG data will be new for our clients, but clients will benefit from accelerated onboarding and new clients can rely on a provider of experience of scale. Importantly, clients can also take comfort from ‘baked-in’ version control. What may work today in-house could quickly become redundant as versions update. EMT is a great example of this. From August this year will already be fully supporting EMT version 4. The beauty of our platform that the data remains accurate and consistent and can be used for multiple complementary reporting requirements, and even digital outputs. We pride ourselves on our expertise and service levels, and we support our clients by delivering multiple solutions from a single platform, ensuring efficiency, reliability, and vendor consistency. But perhaps more and most importantly, giving our clients the focus, the confidence to focus their energy on what they do best.

Well, it certainly sounds like there's been a lot of thought and execution that has gone into rolling out the solution to the EET requirements. So, thank you, Paul, for your insights into the EET and developments therein. That was Paul Poletti-Gadd, Chief Solutions Officer at Broadridge Fund Communication Solutions. I'm Jonathan Boyd. Thanks for watching. If you'd like to find out more about the solutions on offer from Broadridge, please visit broadridge.com