Finance
SEC to Crack Down on Misleading ESG Claims With Fund Rules
- Agency seeks to eliminate names that critics call greenwashing
- Wall Street regulator proposed plan at meeting on Wednesday
Gary Gensler, chairman of the Securities and Exchange Commission.
Photographer: Evelyn Hockstein/Reuters/Bloomberg
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The US Securities and Exchange Commission is taking its biggest step yet to stop money managers from misleading investors when they claim their funds are focused on environmental, social or governance issues.
The agency proposed a slate of new restrictions Wednesday aimed at ensuring ESG funds accurately describe their investments. Some would also need to disclose the aggregated greenhouse gas emissions of companies they’re invested in, according to the SEC.