While major super funds have individually said they are taking steps to improve their sustainable finance disclosures, at a recent roundtable hosted by the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC), fund executives highlighted a number of difficulties that could put them at risk of greenwashing. According to notes from the fifth Superannuation CEO Roundtable, common challenges for funds include “obtaining the right expertise internally and externally, the lack of standardised taxonomy, ensuring investment screens operate effectively, oversight of third-party providers, and ensuring accurate wording in all marketing materials”. ASIC originally released an information sheet on how to avoid greenwashing when offering or promoting sustainability-related products in June last year.
Since then, the regulator has commenced civil penalty proceedings against Active Super and Mercer Super, as well as Vanguard, over greenwashing allegations. “Recent guidance issued by ASIC and subsequent disclosure-related enforcement actions have highlighted the need for product issuers, such as superannuation funds, to ensure that their sustainable finance disclosures are true and accurate,” the roundtable notes read. “APRA and ASIC emphasised that the introduction of mandatory climate-related financial disclosure requirements in Australia aim to enhance transparency and boost informed decision making by investors.”
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