The European Supervisory Authorities (EBA, EIOPA, and ESMA) have published their third annual report on disclosures of principal adverse impacts under the Sustainable Finance Disclosure Regulation (SFDR). The report assesses entity and product-level Principal Adverse Impact (PAI) disclosures, which aim to show the negative environmental and social impacts of financial institutions' investments and the actions taken to mitigate them. The findings indicate that financial institutions have improved the accessibility of their PAI disclosures, and there has been positive progress in the quality of information disclosed by financial products and PAI statements. Some National Competent Authorities (NCAs) reported slight improvements in compliance with SFDR disclosures in their national markets. The report includes recommendations to NCAs to ensure convergent supervision of financial market participants' practices and to the European Commission for a comprehensive assessment of the SFDR. The ESAs have also developed an overview of good practices related to the location, clarity, and complexity of disclosures based on a survey of NCAs. The report aims to promote transparency and accountability in the financial sector regarding sustainable finance. The SFDR requires financial institutions to disclose the principal adverse impacts of their investments on the environment and society. The ESAs' report provides insights into the progress made by financial institutions in disclosing and mitigating these impacts. The report is part of the ESAs' efforts to promote sustainable finance and responsible investment practices in the European Union.