Results of further development of the FNG-Label and the start of this year's application period

In spring 2024, a comprehensive, stakeholder-based further development of the FNG-Label was launched. A survey and several stakeholder dialogs ultimately led to important findings in a consultation lasting until the end of January 2025. Together with the feedback already received, this resulted in:

FNG-Label Transition

  • In addition to the established FNG-Label, there will be a new FNG-Label Transition.
  • This new quality mark will, in a familiar manner, transparently depict varying quality levels of sustainable investments with a transition strategy, using minimum requirements (“must-haves”) and a grading model (“optional extras”) with up to three stars.
  • The minimum exclusions will follow ESMA fund name guidelines, applying CTB exclusions. Additionally, stricter exclusions already known from the established FNG-Label will be enforced for weapons and armaments. Both labels will share the same weapons exclusion criteria.

Established FNG-Label

  • The established FNG-Label will continue to cover all other investment styles with sustainability-related objectives (e.g., values-based approaches, ESG risk and opportunity management, or sustainable investments according to the SFDR and/or EU Taxonomy). As before, it will recognize “well-structured sustainability funds,” regardless of whether these funds fall under the ESMA guidelines on funds’ names.
  • The minimum exclusion criteria will remain unchanged, except for the integration of the OECD Guidelines for Multinational Enterprises on responsible business conduct as an alternative to the ten core principles of the UN Global Compact.
  • Stronger integration of regulatory documents will reduce the application effort.

Why a New FNG-Label?

  • Transition as the central challenge: Transition is THE challenge for the economy, and transition investment strategies are gaining market importance. However, a uniform, legally binding definition for transition investments is still lacking, leading to uncertainties – as regulatory frameworks leave many aspects open. The FNG-Label Transition addresses this gap by establishing a clear and much-needed quality standard for transition-related financial products.
  • A separate Transition-Label is needed: The FNG-Label Transition is being introduced as a separate seal, as the established FNG-Label provides clear guidance with fixed minimum requirements and exclusions. Any deviation from these standards could create confusion.
  • Ready for future regulatory developments: In addition to the FNG-Label Transition, discussions were held about introducing a „Sustainable“ label, aligned with emerging product classification proposals. However, market feedback indicated that it would be prudent to wait for further SFDR developments before making any decisions. Once regulatory clarity emerges, stakeholders will reassess whether and how such a label would be meaningful and necessary.

Start of application and new Pre-Screening-Possibility

  • The application period for both FNG-Labels will begin on April 4, as usual. Anyone who wants to be sure of undergoing the full review and assessment process, including sparring sessions and a telephone conference, should apply by July 7.
  • For those who need more time: The application period has been divided into two additional phases and extended until October 15 (possibly reduced sparring).
  • End of March at the latest, the revised rules of procedure for both FNG-Labels will be available.
  • New Pre-Screening: Starting April 4, you can opt for a pre-screening that – with reduced resource expenditure and a concise set of questions – quickly determines whether your product meets the fundamental features and strategies required for the minimum requirements of one of the FNG-Labels, and which label (the established FNG-Label or the FNG-Label Transition) is best suited. This provides a solid basis for deciding whether to proceed with a full application.

*Please fill out your profile completely when registering so that it can be assigned during the activation process. Registrations without a completed profile cannot be processed.

**Please note that once all submitted products have passed the minimum requirements, it is technically no longer possible to book/activate further products. Therefore, please have the desired number of products activated at the beginning of the process.

IMPORTANT: Applicants who have already registered/applied should log in with their existing access data!

VergabeFeier auf dem Römerberg in Frankfurt am Main: 11.12.2025

VergabeFeier auf dem Römerberg in Frankfurt am Main: 11.12.2025

In addition to the CTB exclusions and the same weapons exclusions as the established FNG-Label (i.e., conventional and broader scope of controversial weapons), the FNG-Label Transition is subject to further minimum requirements to ensure the quality of transition strategies.

Definition of transition investments
The EU Commission’s proposal serves as the basis for the definition of transition investments (see: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32023H1425). According to this, transition means an improvement in sustainability performance in line with targets such as the 1.5 degree target of the Paris Agreement or the other environmental targets of the EU taxonomy. Transition investments are therefore investments in:

  • Portfolios that replicate CTB or PAB benchmarks,
  • Taxonomy-compliant economic activities (transition activities or economic activities that will become taxonomy-compliant within a maximum of 5 years – in exceptional cases 10 years),
  • Companies with a credible transition plan,
  • Companies with credible science-based targets (e.g. SBTi pathway).

Beyond this understanding, the environmental SDGs can also be used as the basis for a transition strategy.

Social aspects are largely missing from the current EU definition. The FNG-Transition label addresses this point and calls for social SDGs to be covered as part of the transition strategy.

DNSH principle (Do No Significant Harm)

According to SFDR (Art. 2(17)), sustainable investments must not cause significant harm to other sustainability goals. As no specific criteria yet exist for transition investments, the FNG Transition Label also integrates the DNSH principle for transition investments. Investments in issuers or economic activities that cause significant harm at the time of the investment are permitted if

  1. the reduction of this damage is part of the product’s transition strategy, and
  2. the issuer or activity is on a credible path to achieving the sustainability goal.

For all other sustainability goals that are not the focus of the transition strategy, the DNSH principle applies without restriction. The assessment is based on the Principal Adverse Impact (PAI) indicators, as is already the case for sustainable investments in accordance with SFDR Art. 2(17).

Prevention of transition-washing

For products that demonstrably invest in so-called “high-impact” sectors and wish to apply for the FNG Transition label, the following applies: The transition strategy must at least relate to the climate/environmental transition (based on the sustainability goals of the EU taxonomy or environment-related SDGs). This prevents a coal producer, for example, from being considered a transition investment because it implements a transition element in the social sphere. Anyone investing in fossil fuels must consequently pursue an environment-related transition strategy. This requires further information on investments in “high-impact” sectors. The definition of “high-impact” sectors follows the CTB and PAB Regulation (Art. 3, see https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32020R1818)

The exact details for both FNG seals will be formalized as usual in the revised procedural conditions by the end of March at the latest.

Application period FNG-Labels 2026:

  • 04.04.2025 to 07.07.2025 (complete examination incl. sparring & telephone conference)
  • Plus: extension possible until 15.10. (possibly reduced sparring)
  • Examination and evaluation process/sparring: until 14.11.2025

Award ceremony at the Römerberg in Frankfurt am Main: 11.12.2025

The FNG-Label
online platform

ESG INSIDE: Information for product managers

Advertising sustainability is easy. Therefore, it is even more important to verify genuine quality and make it visible. Show investors and distribution partners at a glance that your sustainable products meet or exceed today’s expectations for sustainability funds.

The independent research and assessment is carried out by the non-profit academic association F.I.R.S.T. in conjunction with Advanced Impact Research GmbH (AIR) as a university spin-off. Prof. Dr. Timo Busch from the University of Hamburg is on the academic advisory board. In this context, F.I.R.S.T.  bears overall responsibility, in particular for the coordination, awarding, and marketing of the FNG-Label. The review process is also monitored by an external committee with interdisciplinary expertise.

Requirements and
application documents

Sustainably managed investment funds or similar investment vehicles of all asset classes can apply for the FNG-Label, provided they comply with the UCITS or an equivalent standard and are authorized for distribution in at least one of the following countries: Germany, Austria, Switzerland, or Liechtenstein.

Each Label requires the fulfillment of certain minimum requirements. To be awarded the Label, the product has to meet all minimum requirements. Applicants who apply for both the minimum requirements and the grading model may achieve up to three stars in the grading model, signaling varying levels of quality. The number of stars awarded depends on the number of percentage points achieved in the grading model.

As stated in the rules of procedure, the assessment team from Prof. Dr. Timo Busch has the right to request additional documents to verify the product’s compliance with the Label’s criteria.

FNG-
Sustainability Profile

The FNG-Sustainability Profile provides a brief overview of a fund’s sustainability information and supplemental data.

Examples may be found here. Depending on the fund the data may be available in English.

Further
Information

You should also download the rules of procedure before filling in the questionnaire to be able to better understand the Label criteria.

Should you require more detailed information about the application process, the application requirements, and the Label criteria, please contact us at fng-siegel-pruefung@air4p.org/roland.koelsch@first-ev.org or by phone at +49 178 5635724.

We would also be happy to visit your office to discuss the FNG-Label. Please contact us to arrange an appointment.

Explanatory videos
about the FNG-Label

FNG-Label Process
-Minimum Requirements-

In this video, we explain the labeling process and give you further information on the minimum requirements of the FNG-Label.

 

 

FNG-Label Process -Grading Model-

In this video, we explain the procedure of the grading model. The grading model – as the voluntary part after the successfully completed mandatory  part – gives you the opportunity to receive a higher award of up to three stars in addition to the minimum requirements.

FNG-Label Process -Referencing-

In this video, we explain the feature “referencing“. We go into the basic idea behind referencing and show you how to use it in the Online-Tool.



How does the Online-Tool work?

In this video, we explain how the Online-Tool works.

 

Der Qualitätsstandard für Nachhaltige Geldanlagen im deutschsprachigen Raum.

F.I.R.S.T. e.V.
Rentzelstr. 7
D-20146 Hamburg
Tel: +49 178 56 35 724
E-Mail: info@first-ev.org

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