EU fund rules risk defunding the energy transition, Amundi warns
Europe's largest asset manager says proposed SFDR revisions fall short of what transition funds need to hold oil and gas companies.
Amundi SA said on Sunday (2026-07-19) that proposed revisions to the EU's Sustainable Finance Disclosure Regulation do not go far enough in allowing asset managers to hold oil and gas companies inside transition-labelled funds. Elodie Laugel, the firm's chief responsible investment officer, made the position public as Brussels prepares to reshape rules governing a framework that covers assets worth about $14 trillion.4
The argument lands at an awkward moment for European ESG policy. An analysis by Covalence found that fossil energy accounted for 30% of all sector exclusions in the second quarter of 2026, up four percentage points in just three months. Exclusion rates are accelerating precisely as one of the architects of responsible investment in Europe argues that wholesale exclusions are the wrong instrument for a framework designed to fund change.4
Amundi's position is narrower than it might appear. A transition fund, by its own regulatory logic, should engage with companies actively shifting their operations. If SFDR's revised language bars fossil producers from the transition category, it removes the financial incentive for those companies to pursue verifiable decarbonisation plans. The fund that cannot hold them cannot influence them.4
The carbon market has been watching ICE EUA Dec-rolling prices for signals on European climate policy direction. EUAs made an early run at the €80 mark on Wednesday (2026-05-27) before a sharp afternoon reversal left a net 0.9% gain for the session, according to Carbon Pulse. Rally and reversal alike reflected the same underlying uncertainty: policy outcomes are harder to read than fundamental supply-demand flows. A bearish, policy-driven contrarian signal on ICE EUA Dec-rolling sits in tension with the broadly bullish consensus, and the SFDR revision debate is one reason why.3
The industrial side of the EUA market illustrates the difficulty. BASF plans to buy back €12 billion of its own shares between 2025 and 2028, even as it complains publicly about EU carbon compliance costs, according to Carbon Pulse. A company absorbing compliance costs at that scale while returning capital to shareholders is not planning an abrupt pivot to low-carbon investment. If transition funds cannot hold it, they cannot shape its decarbonisation timeline.3
Credibility problems elsewhere in European carbon markets add another layer. A Bloomberg investigation found that 30 Chinese voluntary carbon projects, claiming to save 2.1 million tonnes of CO2, equivalent to the annual emissions of around 500,000 cars, were invalidated after registration with Austrian, Polish and Luxembourg authorities. Projects in China's Changqing oilfield alone had claimed to avoid almost 120,000 tonnes of CO2e emissions. When voluntary-market credits prove hollow, regulators face pressure to tighten transition definitions, not loosen them — the opposite of what Amundi is asking for.2
The performance argument cuts both ways. Top renewable-power users outperformed fossil-exposed peers by 6% as of May 2026, according to the same report. That spread gives exclusion-focused managers a commercial defence that is difficult to dismiss. If fossil-holding transition funds consistently underperform, the commercial case for SFDR loosening weakens regardless of what the regulation permits.4
Amundi is betting the political arithmetic runs differently. A BCG survey found that 84% of investors worldwide considered it important for oil and gas companies to demonstrate profitable growth from low-carbon investments by 2025. That demand for engagement rather than exclusion is the intellectual basis for Laugel's position. Whether Brussels reads the same survey depends on how the Commission weighs the performance data against the transition theory.1
Any formal European Commission guidance on which fund categories can hold fossil exposures will determine how a portion of that $14 trillion is allocated. For the ICE EUA Dec-rolling market, where a policy-driven bearish signal is running against the broad consensus, the Commission's eventual SFDR text will be the first hard test of which argument Brussels finds more compelling.4