AIC applauds FCA action on greenwashing
The inclusion of investment companies will create a level playing field for all funds.
Today the Association of Investment Companies (AIC) responded to the FCA paper, ‘Sustainability Disclosure Requirements (SDR) and investment labels’ Consultation Paper CP22/20.
Richard Stone, Chief Executive of the Association of Investment Companies (AIC), said: “We applaud the FCA’s decision to include investment companies in the proposed sustainable investment labels. Investment companies’ inclusion creates a level playing field for all funds which is vital for consumers who need to be confident that they are comparing like with like when choosing a sustainable fund.
“It’s reassuring that the FCA is proposing robust rules to address greenwashing which is increasingly undermining consumers’ confidence in ESG claims. Recent AIC research1 showed that 58% of investors surveyed are not convinced by ESG claims from funds, up from 48% last year. Investors who do not consider ESG criteria are particularly cynical, with 55% saying they are not convinced by ESG claims from asset managers which doubled from 27% last year.
“We support the proposed simplification of the investment labels down to three main categories which will ensure the regime will work effectively for consumers. It’s encouraging that the ‘sustainable focus’ label sets a high threshold, namely 70% investment into environmental and social sustainability projects.
“The ‘sustainable impact’ label is especially welcome as investment companies are particularly suitable for these investments. They provide permanent capital and are able to invest in hard-to-sell assets like renewable energy infrastructure and accommodation for vulnerable people.”
You can read more about the AIC’s ESG research here.
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Notes to editors
- The online survey of 402 private investors was commissioned by the Association of Investment Companies (AIC) and conducted by Research in Finance. Respondents were mixed by age and gender, investable assets and region but all had at least some money to invest and owned at least one investment product. All respondents self-select some of their investments, though just over a quarter also invest through a financial adviser or wealth manager. The online survey was followed by ten in-depth phone interviews with selected participants to gain further insights. The online survey was conducted from 18 to 28 July 2022.
- The Association of Investment Companies (AIC) was founded in 1932 to represent the interests of the investment trust industry – the oldest form of collective investment. Today, the AIC represents a broad range of closed-ended investment companies, incorporating investment trusts and other closed-ended investment companies and VCTs. The AIC’s members believe that the industry is best served if it is united and speaks with one voice. The AIC’s vision is for closed-ended investment companies to be considered by every investor. The AIC has 354 members and the industry has total assets of approximately £262 billion.
- For more information about the AIC and investment companies, visit the AIC’s website.
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