SEC proposes to clamp down on greenwashing of investment funds

The Securities and Exchange Commission (SEC) published two proposals today to improve the accuracy and transparency of funds making environmental, social, and governance claims.

The first proposal would require that 80 percent of a fund’s investments adhere to claims made in its name. 

The second proposal would require funds and investment advisers to disclose how they are defining and achieving their claims. Funds focused on environmental factors would also be required to disclose their greenhouse gas emissions. 

A 60 day public comment period will begin after the proposals are published in the Federal Register.