SFDR disclosures – Neox Capital

Last Updated: 26 February 2026

In accordance with Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (the “Sustainable Finance Disclosure Regulation” or “SFDR“), Neox Capital Ltd. (the “Company” or “NEOX“) publishes the following entity-level disclosures on the integration of sustainability risks and consideration of principal adverse impacts.

This disclosure is made pursuant to Articles 3, 4 and 5 of the SFDR and applies to the Company’s investment advisory activities.

Article 3 – Integration of Sustainability Risks in Investment Decision-Making

3.1 What are Sustainability Risks?

A sustainability risk is defined as an environmental, social or governance (“ESG”) event or condition that, if it occurs, could cause an actual or potential material negative impact on the value of investments advised by the Company.

Examples of sustainability risks include but are not limited to:

Environmental risks: Climate change impacts, natural resource depletion, pollution, biodiversity loss.
Social risks: Labour standards violations, human rights concerns, health and safety issues, community relations.
Governance risks: Board structure weaknesses, executive remuneration misalignment, corruption, inadequate risk management.

3.2 Integration of Sustainability Risks

The Company has adopted a proportionate approach to the integration of sustainability risks, considering its size, the nature and scale of its activities, and the types of financial instruments on which it provides investment advice.

The Company integrates sustainability risks into its investment advisory process through the following measures:

Due diligence: The Company conducts due diligence on recommended investment products and considers available information on sustainability risks associated with underlying investments where such information is provided by product manufacturers.
Client communication: If the client wishes the Company to consider Sustainability Risks, the Company discusses material sustainability risks with clients where relevant to their investment objectives and risk profile.
Product selection: If the client wishes the Company to consider Sustainability Risks, when recommending financial instruments, the Company considers sustainability-related information disclosed by financial product manufacturers under Articles 6, 8 and 9 of the SFDR.
Ongoing monitoring: The Company monitors developments in sustainability risk factors that may materially affect recommended investments and advises clients accordingly.

The Company’s approach to sustainability risk integration is detailed in its SFDR Policy which is linked to this website’s disclosure.

3.3 Assessment of Likely Impact of Sustainability Risks

The Company assesses that sustainability risks may have varying impacts on the returns of financial instruments depending on the specific risk factors, sectors, geographic regions and timeframes involved.

Material sustainability risks, if they materialise, could lead to:

Reduction in asset values
Increased volatility
Liquidity constraints
Reputational damage affecting investee companies
Regulatory or legal consequences

The magnitude of impact will depend on the severity of the sustainability event, the exposure of underlying investments, and the resilience of affected entities.

Given the Company’s advisory role, it relies substantially on sustainability risk disclosures provided by product manufacturers. The Company encourages clients to consider sustainability risks as part of their overall investment decision-making process.

Article 4 – Statement on Principal Adverse Impacts (PAI)

4.1 Decision Not to Consider Principal Adverse Impacts

Financial advisers are required to disclose whether they consider the principal adverse impacts (“PAI”) of investment decisions on sustainability factors or, if they do not, to explain the reasons for that decision.

The Company has decided not to consider the principal adverse impacts of investment decisions on sustainability factors in its investment advice at this time.

4.2 Reasons for Not Considering PAI

This decision has been made after careful consideration of the following factors:

Size of the Company: NEOX currently employs four (4) employees and does not meet the threshold of 500 employees specified in Article 4(3) of the SFDR. As a small financial adviser, the Company operates with limited resources and infrastructure.
Nature and scale of activities: The Company provides investment advisory services to a limited client base. The aggregate assets under advice are modest in scale, and the Company’s investment decisions consequently have a minimal adverse impact on sustainability factors at an aggregate level.
Types of financial products: The Company advises primarily on financial instruments manufactured by third-party product providers. The Company does not manufacture financial products and has limited ability to influence the PAI consideration practices of external product manufacturers.
Data availability and cost: Comprehensive PAI data across all potential investment instruments is not consistently available, and obtaining, processing and reporting on such data would impose a disproportionate cost burden relative to the Company’s operational capacity.
Proportionality: Given the above factors, the Company has concluded that a proportionate approach at this stage is to focus on integrating sustainability risks (Article 3) without undertaking full PAI due diligence and reporting.

4.3 Commitment to Transparency and Alternative Disclosures

Notwithstanding the decision not to consider PAI at this time, the Company remains committed to transparency and responsible investment practices. The Company:

Continues to integrate sustainability risks into its investment advisory process as described under Article 3 above
Adheres to applicable industry standards and guidelines on sustainable finance
Engages with product manufacturers to understand their sustainability approaches and encourages the adoption of responsible investment practices
Provides clients with information on sustainability characteristics of financial products where such information is disclosed by product manufacturers under the SFDR

4.4 Reassessment and Review Date

The Company recognises that its operational scale, client base and market conditions may evolve over time. The Company commits to reassessing its decision not to consider principal adverse impacts no later than 30 June 2027, considering:

Growth in the size of the Company and its employee base.
Changes in the scale of assets under advice.
Developments in data availability and reporting infrastructure for PAI indicators.
Evolution of regulatory expectations and industry best practices.
Client demand for PAI consideration in investment advice.

Any change to the Company’s PAI consideration approach will be reflected in an updated version of this disclosure and communicated to clients in a timely manner.

Article 5 – Integration of Sustainability Risks in Remuneration Policy

5.1 Remuneration Policy Overview

Article 5 of the SFDR requires financial advisers to disclose how their remuneration policies are consistent with the integration of sustainability risks.

The Company’s remuneration policy is designed to attract, retain and motivate qualified professionals while aligning employee interests with the long-term success of the Company and the best interests of its clients.

5.2 Structure of Remuneration

The Company’s remuneration framework consists of:

Fixed remuneration: All employees receive a fixed salary commensurate with their role, experience and responsibilities
Variable remuneration: The Company may award discretionary variable remuneration (bonuses) on an annual basis, subject to individual and Company performance

5.3 Consistency with Sustainability Risk Integration

The Company’s remuneration policy is consistent with the integration of sustainability risks in the following respects:

Qualitative performance criteria: Variable remuneration is determined not solely by quantitative metrics but also on qualitative (non-financial) criteria, including adherence to the Company’s policies, ethical conduct, risk management, and quality of client service. This ensures that employees are not incentivised to disregard sustainability risks in pursuit of short-term financial targets
Avoidance of excessive risk-taking: The discretionary nature of variable remuneration and the assessment framework discourage excessive risk-taking, including the disregard of material sustainability risks that could negatively impact client portfolios
Long-term alignment: Remuneration decisions consider the long-term interests of clients and the sustainable operation of the Company, rather than short-term performance alone
Training and competence: The Company invests in ongoing training and professional development of its staff, including training on sustainability risks, SFDR requirements and responsible investment practices, thereby embedding sustainability awareness into the organisational culture
Governance and oversight: Remuneration decisions are subject to governance oversight, ensuring that they are fair, transparent and aligned with the Company’s risk management framework, including sustainability risk considerations

5.4 Ongoing Review

The Company commits to reviewing its remuneration policy regularly to ensure continued consistency with its sustainability risk integration approach and compliance with applicable regulatory requirements.

Further details on the Company’s Remuneration Policy Consistency are available in the SFDR Policy (link).

For further information or queries regarding this disclosure, please contact:

Compliance Officer
Email: compliance@neoxcapital.com