Efama says “lack of clarity” on Esma guidance in fund naming

The European Fund and Asset Management Association (Efama) has advised the European Securities and Markets Authority (Esma) to postpone the publication of its forthcoming ESG fund-naming guidance. Under present proposals, quantitative thresholds will be utilised as thresholds for fund names. However, EFAMA members are concerned about the suggested numerical threshold method since it may fail to solve the industry’s underlying greenwashing difficulties due to the “present lack of clarity on several fundamental sustainable finance topics.”

The European Fund and Asset Management Association (Efama) has advised the European Securities and Markets Authority (Esma) to postpone the publication of its forthcoming ESG fund-naming guidance. Under present proposals, quantitative thresholds will be utilized as thresholds for fund names. However, EFAMA members are concerned about the suggested numerical threshold method since it may fail to solve the industry’s underlying greenwashing difficulties due to the “present lack of clarity on several fundamental sustainable finance topics.”

ESMA’s proposals centre on funds that use ESG-related naming terms and allocate at least 80% of investments to Sustainable Finance Disclosure Regulation (SFDR)-defined characteristics. Funds with sustainability-related names must devote at least 50% of their assets to sustainable investing.

Read more: https://www.funds-europe.com/news/efama-hits-out-at-lack-of-clarity-in-esma-fund-naming-guidance