October 19, 2021

Volume XI, Number 292

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October 19, 2021

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October 18, 2021

Subscribe to Latest Legal News and Analysis

Citing “Greenwashing” Concerns, IOSCO Issues Recommendations to Securities Regulators on Sustainability-Related Practices, Policies and Disclosures

On June 30, 2021, the International Organization of Securities Commissions (IOSCO)—which counts the SEC among its members—issued a consultation report recommending that securities regulators set regulatory and supervisory expectations for asset managers regarding sustainability-related risks and opportunities. 

IOSCO’s recommendations to securities regulators covered five areas:

  1. Asset Manager Practices, Policies, Procedures and Disclosures. Set regulatory and supervisory expectations for asset managers with respect to sustainability-related practices, policies, procedures and disclosures.

  2. Product Disclosure. Clarify and/or expand existing regulatory requirements or create new regulatory requirements to improve sustainability-related product disclosure.

  3. Supervision and Enforcement. Adopt supervisory and enforcement tools to ensure asset managers and sustainability-related products comply with regulatory requirements and to address breaches.

  4. Terminology. Encourage industry participants to develop common sustainability-related terminology to ensure consistency in the asset management industry.

  5. Financial and Investor Education. Promote financial and investor education initiatives relating to sustainability and enhance existing initiatives.

The foregoing recommendations are intended to address IOSCO’s concerns regarding “greenwashing,” among other things.  Greenwashing generally refers to the practice by asset managers of misrepresenting their own sustainability-related practices or the sustainability-related features of their investment products.  IOSCO’s report emphasized the investor protection-related concerns with greenwashing given the significant growth in the market for sustainability-related investment products.

The Board of IOSCO invited market participants and interested parties to submit comments on the report on or before August 15, 2021.

IOSCO’s consultation report is available here.

© 2021 Vedder PriceNational Law Review, Volume XI, Number 251
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About this Author

John Marten Investment Attorney Vedder Price Law FIrm
Shareholder

John S. Marten, a Shareholder in the Chicago office of Vedder Price, has substantial experience representing clients in the investment management industry.

As a member of the firm’s Investment Services group, Mr. Marten counsels clients on a wide variety of matters involving the application of the federal securities laws to investment companies, investment advisers and broker-dealers. He has significant experience counseling investment company clients with respect to new products and was recently involved in the creation of two mutual funds...

(312) 609 7753
Nathaniel Segal Investment Attorney Vedder Price Law Firm
Counsel

Nathaniel Segal is counsel at Vedder Price and a member of the Investment Services group. He focuses his practice on investment companies and investment advisers in connection with the organization and operation of investment products and services, including traditional mutual funds, closed-end investment companies (including interval funds and listed closed-end funds), variable insurance products and registered hedge funds, as well as mutual funds utilizing complex hedging and absolute return strategies. Mr. Segal has experience in conducting transactional due diligence...

(312) 609 7747
Jacob Tiedt,Vedder Price law firm investment services attorney
Shareholder

Jacob C. Tiedt is a Shareholder at Vedder Price and a member of the Investment Services group.

Mr. Tiedt’s practice includes the representation of registered mutual funds, closed-end funds and exchange-traded funds; private funds; investment advisers; and other financial institutions on a broad range of regulatory, governance and compliance matters. Mr. Tiedt regularly counsels clients on matters relating to SEC registration, disclosure and compliance; shareholder solicitation; NYSE, Nasdaq and FINRA regulation; corporate governance; and board administration. Mr....

312-609-7697
Jake Wiesen Investment Attorney Vedder Price
Associate

Jake W. Wiesen is an Associate in the Chicago office of Vedder Price and a member of the firm’s Investment Services practice group.

While in law school, Mr. Wiesen served as Associate Editor of the University of Illinois Law Review, a student attorney for the Civil Litigation Clinic and a teaching assistant for Introduction to Advocacy. He was also the recipient of the CALI Excellence for the Future Award in Administrative Law and Employee Benefits.

Prior to joining Vedder Price, Mr. Wiesen worked as a legal intern for the Chicago Transit Authority and served as a...

312 609 7838
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