Australia’s corporate regulator, the Australian Securities and Investment Commission (ASIC), led a series of enforcement actions last year against greenwashing in the financial services industry. These included Mercer Superannuation, Vanguard Investments Australia, and Active Super for greenwashing. ASIC has made it clear the momentum will continue:
“Greenwashing matters we are currently progressing all broadly allege misleading and deceptive conduct. This law is not new. What is new is the attention from regulators, including ASIC and the ACCC.”
ASIC’s enforcements mostly centered around financial services companies offering investment vehicles that did not live up to their advertised green credentials. For example, Vanguard Investments Australia claimed that their investment vehicle excluded companies with large carbon footprints, while in reality, the fund contained holdings from an index that included fossil fuel companies.
These actions have made the ASIC a global leader in greenwashing regulation and with the Australian government set to introduce mandatory climate reporting in 2024, the agency is likely to continue to have their hands full. Regulators globally are playing catch up with sustainable finance and it will likely take more enforcement actions to create a market that investors can trust.
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