# What is the difference between an Article 8 and an Article 9 fund for the company it invests in?

Canonical: https://senseible.earth/answers/article-8-vs-article-9-fund-investee-company

An Article 8 fund promotes environmental or social traits and checks that you follow good governance. An Article 9 fund must treat almost every holding as a sustainable investment, so it has to show your company contributes to an environmental or social goal, does no significant harm and is well governed. Expect deeper diligence from Article 9.

## What each fund must prove about you

- Article 8: that you meet the environmental or social characteristics the fund promotes, often exclusions or minimum ESG scores, and that you follow good governance practices.
- Article 8 with a sustainable investment share: the same, plus the full sustainable investment test for the part of the fund it counts as sustainable.
- Article 9: the full test for nearly every holding, apart from cash and hedging. A fund whose objective is cutting carbon is expected to track an EU Climate Transition or Paris-aligned Benchmark where one exists.

## The sustainable investment test in Article 2(17)

SFDR does not fix how a fund measures contribution. The Commission's answers published in April 2023 confirm each fund sets and discloses its own method, so two Article 9 funds can judge the same company differently.

1. Contribution: your activity contributes to an environmental or social objective, measured by indicators such as emissions, energy, water or revenue from climate solutions.
2. Do no significant harm: you do not seriously harm other objectives. Funds apply this using the PAI indicators, so your emissions, fossil exposure, waste and controversies are checked.
3. Good governance: sound management structures, employee relations, staff pay and tax compliance.

## What changes for you in practice

- Data: an Article 9 fund needs your PAI figures to clear the harm test, not just to report them.
- Ongoing checks: if you fail the test later, an Article 9 fund may have to sell or stop counting you as sustainable. An Article 8 fund usually has more room.
- Evidence: claims about climate contribution need numbers with sources, such as tonnes avoided or revenue share, not descriptions.

## A pending change to the labels

The Commission proposed on 20 November 2025 to replace the Article 8 and 9 labels with three product categories: sustainable, transition and ESG basics. The Council agreed its position on 24 June 2026, and talks with the Parliament were being prepared in October 2026. Until a final text is agreed and applies, Articles 8 and 9 remain the law, and funds will keep asking for the same data.

## What Senseible does here

Senseible keeps the evidence behind the environmental figures a fund cites, such as emissions and energy use from your invoices and bills, as a self-declared record. It does not assess whether a fund or your company qualifies under Article 8 or 9.

- [Why EU funds ask for SFDR PAI data](https://senseible.earth/answers/why-eu-fund-asks-for-sfdr-pai-data)
- [SFDR PAI data request: what to send](https://senseible.earth/answers/sfdr-pai-data-request-from-eu-investor)
- [EU Taxonomy DNSH criteria explained](https://senseible.earth/answers/eu-taxonomy-dnsh-criteria-explained)

Sources: [Regulation (EU) 2019/2088 on sustainability-related disclosures (SFDR), Articles 2(17), 4, 8 and 9 (eur-lex.europa.eu)](https://eur-lex.europa.eu), [Commission Delegated Regulation (EU) 2022/1288, Annex I (eur-lex.europa.eu)](https://eur-lex.europa.eu), [European Commission answers on SFDR questions (April 2023), in the ESAs' consolidated questions and answers on SFDR (JC 2023 18)](https://finance.ec.europa.eu), [European Commission, proposal to revise SFDR (20 November 2025)](https://finance.ec.europa.eu)

Last reviewed 2026-10-17. SFDR revision trilogues were being prepared in October 2026; check whether the Article 8 and 9 labels have been replaced before relying on this page.