By Zainab Kuku
The FCA did not hold back in its most recent comments to ESG benchmark administrators, in an indication of its increasingly adversarial approach to ‘greenwashing’. It described the quality of disclosures of ESG factors considered in benchmark methodologies as ‘poor’, and aimed clear warning shots at administrators who fail to comply with the FCA’s feedback.
Read MoreBy Matthew Watts, Rebecca Mangos and Bernard Sia
For the first time, the Australian Securities and Investments Commission (ASIC) has launched court action against a major superannuation trustee for allegedly making misleading statements about the sustainable nature and characteristics of some of its investment products (known as “greenwashing”). ASIC claims the corporate pension fund misled consumers by investing in companies involved with the alcohol, gambling and fossil fuel sectors, contrary to the fund’s marketed sustainable and ethical credentials.
Read MoreBy Áine Ní Riain and Gayle Bowen
On the 17th February 2023, a new Delegated Regulation was published which amends and corrects the existing Sustainable Finance Disclosure Regulation (SFDR) regulatory technical standards with the main changes introducing disclosure requirements for Article 8 and Article 9 funds in respect of fossil gas and nuclear energy related activities to ensure alignment with the EU Taxonomy. The Delegated Regulation does not provide for a transition period and entered into force on 20 February.
The Central Bank of Ireland in order to accommodate the Delegated Regulation published their Process Clarification which confirms that the Central Bank will facilitate a fast-track filing process for the update of pre-contractual disclosure documents pursuant to the Delegated Regulation. Compliance with the Delegated Regulation is now a matter of priority for financial market participants and funds sponsors.
For more information on this regulatory update we suggest a read of our full Article or contact one of our authors.
One of the UK FCA’s favoured ways of regulating is through “Dear CEO” letters, which seek to place a direct onus on CEOs to address FCA priorities. On 3 February 2023, CEOs of UK asset management firms were the recipients of one such letter. Much of the content is not surprising (e.g. the emphasis on consumer outcomes) but we highlight here some particularly notable points:
Read MoreBy: Hayley Trahan-Liptak and Anna E. L’Hommedieu
On February 7, 2023, the U.S. Securities and Exchange Commission (SEC) Division of Examinations (the Division) announced its 2023 examination priorities.[1] The timing of the announcement, over a month earlier than the Division’s examination priority announcements in the prior two years, suggests a return to normal following pandemic-era examinations.
Read MoreBy Maya Ffrench-Adam and Andrew Massey
1 January 2023 marked the latest regulatory milestone in the UK’s phased implementation of the Task Force on Climate-related Financial Disclosures (TCFD) recommendations.
The TCFD – first set up in 2015 by the Financial Stability Board – is an international body that has issued recommendations, targeted at multiple sectors, for disclosing climate-related financial information.
Read MoreBy Jim Bulling and Anabelle Weinberg
ASIC has brought in the New Year with a focus on green-washing, issuing infringement notices against two different companies, one a superannuation fund trustee and the second being an energy company. The corporations have paid $13,320 and $39,960 respectively in compliance with the infringement notices, noting that payment of such infringement notices is not an admission of guilty or liability.
Read MoreBy Jim Bulling and Anabelle Weinberg
1. Australian Government consults on climate-related financial disclosure framework
The Australian Government has released a consultation paper seeking feedback on the design and implementation of their commitment to a standardised, internationally-aligned climate-related financial disclosure framework. The framework proposes a ‘phased’ approach where the increased disclosure obligations apply initially to large, listed entities and financial institutions, and be later expanded to smaller firms.
Read MoreBy Jim Bulling and Anabelle Weinberg
1. ASIC takes further action on greenwashing
ASIC has issued three infringement notices to investment manager Vanguard Investments Australia Ltd (Vanguard) in further action against alleged greenwashing.
ASIC was concerned that Product Disclosure Statements for the Vanguard International Shares Select Exclusions Index Funds may have misled the public by overstating an investment screen which claimed to prevent investment in companies involved in significant tobacco sales.
Read MoreBy: Keri E. Riemer, Michael W. McGrath, Neil T. Smith, Hayley Trahan-Liptak, and Christopher F. Warner
On 15 November 2022, the U.S. Securities and Exchange Commission (SEC) announced its enforcement statistics for its 2022 fiscal year (FY 2022), noting that it filed 760 total enforcement actions — a 9% increase over fiscal year 2021. This total was comprised of 462 new actions, 169 “follow-on” actions, and 129 actions for delinquent filings. Money obtained in SEC actions, comprising civil penalties, disgorgement, and pre-judgment interest, totaled a record-breaking $6.439 billion (compared to $3.852 billion in fiscal year 2021). Civil penalties, totaling $4.194 billion, were also the highest on record.
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