Make no mistake – corporate regulators are about the up the ante on ESG.
Australia’s first court proceedings over greenwashing – launched against Mercer Superannuation for allegedly making misleading statements about its sustainable investments – represent the strongest indication yet of how serious the Australian Securities and Investment Commission is about ESG disclosure.
Sustainability-related risks and opportunities are becoming an important focus for investors and stakeholders, but as investment grows, so does the risk of companies falsifying or overstating their credentials.
And with enforcement against greenwashing listed as one of ASIC’s highest priorities in 2023, the corporate watchdog is showing an increased willingness to act.
Firmly in ASIC’s sights are deceptive and misleading claims by listed companies and fund managers, net zero target statements, investment inclusions and screening for sustainability-related financial products.
The Australian Competition and Consumer Commission is also keeping a close eye on industry, after offering its views on what constitutes a misleading environmental claim, while calling out companies for making bogus boasts.
The regulators’ reactions are a clear signal that companies need to know now where they stand on ESG, and they need to be able to back up their credentials.