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FCA Introduces Sustainable Investing Rules and Labels

ESGFCA Introduces Sustainable Investing Rules and Labels
The UK’s Financial Conduct Authority (FCA) has introduced Sustainability Disclosure Requirements (SDR) for asset managers and investment labels. These measures, including an anti-greenwashing rule, aim to assist investors in evaluating the sustainability attributes of investment products amid a growing interest in ESG-oriented funds. The FCA’s rules feature four labels—Sustainability Focus, Sustainability Improvers, Sustainability Impact, and Sustainability Mixed Goals—to help consumers understand the objectives and approaches of investment products. The package also includes naming and marketing rules, with implementation starting in May 2024 for the anti-greenwashing rule, July 2024 for labels, and December 2024 for naming and marketing rules. Ongoing disclosures will be required from large firms by December 2025 and smaller firms a year later. The UK Sustainable Investment and Finance Association (UKSIF) welcomed the regulations, emphasizing their role in building trust in the evolving sustainable investing market.

By FCCT Editorial Team

Disclaimer: The views expressed in this article are independent views solely of the author(s) expressed in their private capacity.

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