FEM logo
Fund EcoMarket

the sustainable, responsible and ethical investment information hub

Fund labelling article written for ESG Clarity

December 2nd, 2021

A big thank you to ESG Clarity for inviting me to write a piece on the important topic of sustainable investment fund labelling.

The first few paragraphs are copied below.

Labels won’t save the planet but they help investors.

‘Words, research and analysis will not save a single tree – only action will’

Let’s start by being brutally honest, if untrendy. The planet does not care what we call companies that emit carbon, destroy rainforests or fuel inequalities, or how we classify them in funds. Names do not change the weather, wipe out species, start or end wars or famines.

The problem however is that investors do care what things are called. And investors matter.

Major investors need to be able to properly understand and analyse what companies do and how they operate. And as the importance of such things has grown investor language has needed to become more sophisticated and nuanced. By contrast however individual investors – who mostly do not spend their lives thinking about investments – are baffled by lots of different new terms, which they often see as jargon.

I’ve been involved in this area – variously known as sustainable, responsible, ESG, impact or ethical investment – for nearly 30 years now and have a somewhat conflicted view on names and labelling conventions. I know words are both deeply irrelevant and hugely important. I also know – as David Attenborough’s most recent book beautifully describes – baselines shift, meaning what is widely accepted today will soon be seen as either too weak or too strong. Most probably the latter.

Read more…

 

The recently published FCA ‘Sustainability Disclosure Requirements and Investment Labels’ paper this refers to (DP21/4) is available here.

 

(These views are of course my own – and not to be viewed as representative of the DLAG (Disclosure and Labels Advisory Group) that I am delighted to be a member of. Julia Dreblow )

Links:

https://esgclarity.com/labels-wont-save-the-planet-but-they-help-investors/

https://www.fca.org.uk/publications/discussion-papers/dp21-4-sustainability-disclosure-requirements-investment-labels

 

Sign Up to our Newsletter

If you are a Financial Services Industry professional you can sign up for our newsletter

Click Here

Latest News

SRI Services response to FCA SDR and labels consultation DP21/4
January 17, 2022

I am delighted to share our response to the FCAs recent ‘Sustainability Disclosure Requirements (SDR) and investment labels‘ discussion paper. Our response was rather lengthy,  so you may prefer to focus on the summary of key points below (the text below is ‘as submitted’): Download our response here: FCA SDR DP 21 4 SRI Services […]

Top 50 Fund EcoMarket sustainable investment searches 2021
January 17, 2022

  Below is a list of the top 50 filter options selected by Fund EcoMarket users during the course of 2021. This shows that, as in previous years, a wide range of filters are used by Fund EcoMarket users, most probably as that is what is required in order to offer advice on sustainable investment […]

ShareAction report on asset managers’ proxy votes
December 17, 2021

ShareAction has just published their 2021 report on shareholder voting. The gist of the report is that many shareholders, most importantly amongst them the largest (because they have the most votes) are not supporting shareholder resolutions on environmental and social issues – even when their proxy advisers are recommending they should. There will doubtless be […]