EUROPEAN financial regulators say they are uncovering more cases of greenwashing by asset managers cashing in on booming demand for sustainable finance, and some are starting to turn the screw on funds that cannot back up what they claim.
Trillions of dollars have poured into sustainable investment strategies in recent years and regulators have taken little action to ensure funds are marketed accurately, partly because of the lack of agreement on what “sustainable”, “green” and “greenwashing” mean.That makes it tough for watchdogs to prove deliberate exaggeration of environmental, social and governance (ESG) credentials, but this week IOSCO, which groups watchdogs, published recommendations to help members find firms who may be hoodwinking investors.
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