Progress on UK SDR and anti-greenwashing rule

Plans should be well advanced by UK authorised firms for implementing the anti-greenwashing rule and by UK authorised fund managers in considering any plans for investment labels for UK based funds.

The Briefing Paper focusses on two important recent FCA publications:

• The extension of UK SDR to portfolio management which, as you will expect, follows on closely from the approach taken for funds which has already been finalised, and
• Guidance on the anti-greenwashing rule which in turn is much as one would expect, taking a high level principled approach. It effectively follows the long established requirement for all communications to be fair, clear and not misleading.

These publications should be helpful in enabling firms to progress their planning for the UK ESG related initiatives for asset management. 

UK authorised firms should already be focussed on the new UK SDR: the anti-green washing rule came into effect on 31 May 2024 and other parts of the UK SDR regime will be phased in, with firms able to use the investment labels regime for UK funds from 31 July 2024; and naming and marketing requirements must be met by 2 December 2024, with further disclosure requirements phased in over the next two years.

With the aim of achieving some sort of consistency and level playing field across products marketed to retail investors, the FCA's Consultation Paper 24/8 sets out proposals to help consumers navigate the sustainable investment market by extending the SDR labelling regime, naming and marketing rules and disclosure requirements to portfolio managers.

We also now have the FCA's Finalised Guidance (FG 24/3) published in April 2024 on the anti-greenwashing rule.

In this Briefing Paper we consider the implications of the two new papers and also provide some updates on initiatives relevant to UK SDR and ESG discussions more generally.

Read the full briefing paper by Kirstene Baillie, Partner, Asset Management and Investment Funds, Fieldfisher LLP here.