Asset managers rebuffed as EU cracks down on use of ‘ESG'
- Media Manager
- Sep 18, 2023
- 1 min read
Pensions & Investments - Bloomberg
Published: September 19th, 2023
Europe's markets watchdog says it isn't backing down from a controversial plan to restrict the use of "ESG" and "sustainability" in fund names, despite a barrage of criticism from asset managers.
The European Securities and Markets Authority wants asset managers to know that it won't abandon its proposal. That's after industry giants, including BlackRock, Amundi and the asset management unit of Goldman Sachs Group, characterized large parts of the plan as potentially unworkable in their responses to an ESMA consultation earlier this year.
"If fund managers don't like the fact that they would have to commit to certain criteria for terms' use in the name, they just don't have to use those terms in the name," Patrik Karlsson, senior policy officer for investment management at ESMA, said in an interview.
ESMA's proposal, first unveiled in November, requires that a fund calling itself "ESG" have at least 80% of its assets promoting environmental, social and governance goals. A fund calling itself "sustainable" — or a related term — needs at least 50% of its assets to live up to that name.
