June 5, 2023

Volume XIII, Number 156


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AUSTRALIA: ASIC Starts 2023 With Focus On Greenwashing

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.

Since October 2022, ASIC has issued infringement notices to 4 different entities including energy companies, an investment fund and a superannuation fund trustee. ASIC has stated that they will continue to actively monitor sustainability-related claims and take action when they consider that representations cannot be substantiated or are factually incorrect.

ASIC’s green-washing allegations provide a timely reminder of what companies should consider when making environmental and socially responsible representations. 

In light of the recent ASIC enforcement activity, companies should consider the following when making sustainability claims:

  • the efficacy of investment screens and whether, in practice, they fully exclude those types of investments that are proscribed;

  • not overstating the efficacy of investment screens or making broad statements which may potentially mislead consumers as to the extent of the investment screening being implemented;

  • whether they can provide a reasonable basis to make representations concerning carbon neutral ambitions or the production of ‘clean energy’, for example, through evidence of specific environmental modelling;

  • whether progress has been made on the development of an environmental/social project, for example, commencing the specific works related to a net zero carbon emissions project; and

  • whether a detailed in plan is in place outlining how the sustainability-related claim will be achieved.

Anabelle Weinberg also contributed to this article.

Copyright 2023 K & L GatesNational Law Review, Volume XIII, Number 17

About this Author

Jim Bulling, KL Gates, financial services lawyer, funds management attorney

Mr. Bulling's practise focuses on banking and financial services and he acts for a range of entities in the financial services and funds management industry. His clients include Australian and international investment managers, banks, trustees of superannuation funds, wholesale and retail investment trusts, funds management companies and financial planning groups.

His main areas of focus include banking and financial product disclosure issues, financial services compliance issues, financial product distribution issues and superannuation and...