The US Securities and Exchange Commission has proposed two new rule changes that aim to prevent greenwashing in ESG funds.
The regulator voted yesterday (25 May) to issue a proposal that would broaden the SEC's fund naming rules, while the other would increased disclosure requirements for ESG funds. The SEC already holds that if a fund's name suggests a focus on particular industries, geographies or investment types, it has to invest at least 80% of its portfolio in those assets. Yesterday's proposal would expand these rules to cover ESG factors, as well as strategies such as value or growth. An SEC official said that the regulator expects the rule to now cover about 75% of funds, compared to 62% befor...
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