How do sustainable finance professionals perceive and prepare for the implementation of the new Sustainable Finance Disclosure Regulation (SFDR)?
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- The European Commission’s November 2025 proposal to reform the Sustainable Finance Disclosure Regulation (SFDR 2.0) introduces a mandatory three category architecture of Sustainable, Transition, and ESG Basics products, anchored in a 70 percent positive contribution threshold and prescriptive engagement requirements, while leaving critical technical parameters to delegated acts unlikely to apply before 2028. Sustainable finance professionals must therefore allocate resources, design products, and communicate with clients on the basis of provisional regulatory signals whose final form remains uncertain. This thesis examines how sustainable finance professionals perceive and prepare for this transition, using a qualitative constructivist design that combines semi structured elite interviews with twelve institutional participants across four professional roles and a nested extreme case study of Funds For Good. Interview data are analysed through hybrid thematic analysis that integrates deductive theory driven codes with inductive codes emerging from the material. The theoretical framework combines neo institutional theory, dynamic capabilities and absorptive capacity, and signalling theory, to connect regulatory pressure, internal capability building, and the communicative function of SFDR 2.0 product categories. The study advances four original constructs, regulatory structural anxiety, forced human capital investments, narrative bifurcation, and the Zodiac Clause, and shows that SFDR 2.0 readiness is mediated by institutional capacity, knowledge management architecture, and structural incompatibilities, particularly between Solvency II prudential requirements and the EU Taxonomy’s treatment of sovereign bonds, that category redesign alone cannot resolve.