The Dutch Pension Federation has called on the Dutch Authority for the Financial Markets (AFM) to clarify and simplify its proposed guidelines on sustainability claims.

In its response to the consultation, the federation stated the guidelines should primarily focus on understandable communications from pension funds to their members about sustainability.

The AFM launched the consultation last month to gather views about its proposed guidance for market participants on how to make correct, clear, and non-misleading sustainability claims.

It noted that communications by market participants, including marketing, often contain sustainability ambitions and other sustainability claims, and the AFM considered transparency on these topics “of great importance”.

However, while the Pension Federation said it believed the basic principles of the guidelines were logical, it warned they can clash with each other.

For example, the federation raised concerns that, as the sustainability aspects of investment policy are complex and differ per asset class, it was impossible to communicate with members about this precisely and to their differing levels of knowledge.

It warned that the inclusion of communications in regulations as part of the proposed guidelines would not contribute to participants’ understanding of or engagement with their pensions.

Pension funds are currently dealing with recent developments in other European sustainability reporting standards and the Pension Federation said it believed the timing of the guidelines was “clumsy”.

“The starting points of the draft guidelines have a clear legal basis and are recognisably set out,” the federation’s consultation response stated.

“At the same time, the application is far from always easy and straightforward. As a result, friction occurs between the assumptions.

“In addition, European regulations already require a great deal of precise and concrete information under the Sustainable Finance Disclosure Regulation.

“In this way, interested participants and stakeholders can always view the policy on socially responsible investment at a more detailed level.”

The AFM is expected to publish the final version of the guidelines after the summer and then use it to monitor pension funds' communications under the Future Pensions Act.

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