Countries around the world are working on taxonomies, disclosure requirements, and labeling laws regulating sustainability claims in finance. Recently, New Zealand’s Financial Markets Authority finalized guidance on Sustainability-related disclosures for financial services firms. A recent Denton’s memo discusses the new guidance and its impact on investing guidelines in New Zealand:
“What’s inside the Guidance tin is divided into four major ingredients, each addressing one of the four disclosure principles the FMA expects issuers to follow:
- Claims need to be clear
- Substantiate your claims
- Messages need to be consistent
- Third-party involvement is effectively managed.
As with the Consultation Draft, the principle of ensuring your claims are clear is the one that is explained in the most extensive detail in the Guidance. This principle provides a sort of ‘fair dealing 101’ outline, and dominates the flavour of the Guidance.”
Global market regulators often draw inspiration from other regulatory regimes. If New Zealand’s guidance is effective, it could impact how other regulators view sustainable finance. Sustainable finance regulation constantly evolves. No country or regulator has discovered a universal set of best practices, and regulatory schemes are still being honed.
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