ESG Investing  

Guide to ESG and regulation

  • Describe how the regulators are incorporating ESG principles into financial services
  • Explain the challenges of doing so
  • Identify how advisers can tackle greenwashing
CPD
Approx.60min
Guide to ESG and regulation
(Adam Kool/Unsplash)

Introduction

As the investment world embeds the concept of ESG further into its business practices many questions have arisen, not least because the concepts making up ESG are broad and open to interpretation.

There is also the risk of greenwashing, where businesses present their funds as being more environmentally or socially friendly than they really are.

The regulators have been looking at this closely and are trying to find ways to standardise ESG principles – this has consequences for financial advisers as ESG advice starts to become part of the regulatory landscape.

Many advisers will be wondering exactly what their responsibilities are.

As the financial community adjusts, this guide aims to offer a few pointers about the new direction investments are taking.

In this guide

CPD
Approx.60min

Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. According to the first article, the SFDR principles have a broader perspective than the FCA's TCFD principles, true or false?

  2. According to the first article, which of the following is NOT a potential future label for a fund in the UK, as outlined by the FCA?

  3. In the second article, according to research by Royal London, the vast majority of advisers believe the interest in ESG is short-lived, true or false?

  4. In the third article, which of the following is NOT defined by Laith Khalaf as a typical customer approach to ESG investing?

  5. In the third article, Quilter Investors says the question 'Do you have any ethical views that may influence your investment selection', is a very good starting point, true or false?

  6. Which of the following is not considered a step advisers can take to avoid greenwashing, as outlined in the fourth article?

Nearly There…

You have successfully answered all the questions correctly, well done!

You should now know…

  • Describe how the regulators are incorporating ESG principles into financial services
  • Explain the challenges of doing so
  • Identify how advisers can tackle greenwashing

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