Without common standards, clear terminology and accessible product classification and labelling, there is a risk that consumers find it difficult to navigate the landscape of products and assess product suitability.
The FCA are now working to standardise the labels these providers use to reflect sustainability characteristics, ensuring consumers have enough information to assess which products meet their needs and hold firms to account for their sustainability claims.
Ethical Screening Managing Director, Mike Head has been approached by the group to submit recommendations on the labelling and classification of products, drawing on his wealth of experience within the responsible investment sector.
The group is working towards approaches for standardisation in the design of:
This forms part of the Sustainability Disclosure Requirements (SDR) set out in the Government’s Greening Finance: A Roadmap to Sustainable Investing, published in October 2021.
Mike comments,
“Ethical Screening have been assessing funds for the past 20 years. The growth in ESG reporting has fuelled a worrying amount of greenwashing. I am delighted to be part of these discussions; as a business our core values focus on trust and transparency, enabling investors to make the right decisions, standardising these terms is a real step forward to implementing change.”
More information on the working group can be found here - DP21/4: Sustainability Disclosure Requirements (SDR) and investment labels
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