The FCA has published examples of good and poor practice on using labels under the SDR regime. The labels were introduced in July 2024, and the FCA has found gradual improvements as firms have become familiar with requirements and the number of labels on the market have increased.
The FCA likes labels that are clear, which avoid complex terms or duplications, and are clearly specifically tailored to the relevant product. It doesn’t like labels which, for instance, don’t include an objective that is not clear, specific and measurable, and which make claims on the standard of sustainability that is not backed by evidence or cannot be substantiated or use KPIs that are not clearly linked to the objective.
It has updated its page on how to use sustainability labels in line with its findings.