The FCA has published new Rules and Guidance in relation to sustainability disclosures in a Policy Statement PS23/16 which, although aimed at the investment sector, include a specific Rule that captures all firms. The aim of the measures introduced is to improve the trust and transparency of sustainable investment products and minimise greenwashing. It is the ‘minimising greenwashing’ element that impacts all firms. The Policy Statement is accompanied by a qualitative research publication and, of more relevance to all firms, a 14-page Guidance document on the anti-greenwashing Rule.
- The anti-greenwashing Rule applies to all authorised firms communicating with UK clients (including communicating or approving financial promotions) about products or services’.
- Firms must ensure that any reference to the sustainability characteristics (so the “environmental or social characteristics” – new FCA Glossary definition) of a product or service is consistent with the sustainability characteristics of the product or service, and is fair, clear and not misleading.
- A new item of Guidance in ICOBS (at ICOBS 2.2.4A G) reminds firms of the obligation noted above.
- The new Rule comes into force on 31st May 2024.