“While Europe has grown its companies and propelled the fund industry to become an ESG leader, I think the US is moving fast,” he said. “The U.S. Securities and Exchange Commission has been speaking a lot about their requirements for foreign companies with regard to ESG disclosure and reporting.”
Around the world, many securities regulators have either developed and enacted regulatory requirements, or published policy recommendations and guidance relating to ESGs or disclosures relating to sustainability for investment funds. The International Organization of Securities Commissions (IOSCO) has established the Sustainable Finance Task Force (STF), which aims to improve sustainability-related disclosures made by issuers and asset managers, among other objectives.
In October last year, the Canadian Securities Administrators (CSA) unveiled a draft framework for climate-related disclosure requirements for reporting issuers, which it opened for a 90-day public consultation. Last week, CSA published guidance on ESG-related investment fund disclosure, which specifically sets out expectations for funds whose investment objectives refer to ESG factors as well as ESG-related funds.
“There is growing interest in ESG investing and this enhanced and practical guidance will play a vital role in helping investors make informed decisions about ESG products as well as preventing potential greenwashing,” said Louis Morissette, CSA President and President of Autorit. and CEO Financial Markets said in the statement announcing the guidance.
Fahey says the pressure on companies and fund managers to disclose ESG data is coming from two fronts. As investors increasingly look to meet investment objectives related to financial risk and return, they are increasingly seeking transparency and disclosure that will allow them to find products and companies that are at odds with their values or beliefs. be aligned. Meanwhile, as regulators and financial industry groups try to build a framework that will provide the standardization and consistency investors need to compare and evaluate different options.