UK financial promoters have been advised that planned new rules governing how sustainable investments can be marketed have been pushed back.
At the end of March, the Financial Conduct Authority announced that its planned policy statement on the new Sustainability Disclosure Requirements (SDR) has been pushed back to the third quarter of 2023.
The planned effective dates for mandatory disclosures, investment labelling and the so-called “anti-greenwashing” rules will also be revised.
“Consumers are at the heart of our proposals for SDR and investment labels,” the FCA said in a statement. “To create a UK market that functions competitively and effectively, those consumers must be able to trust sustainable investment products.”
The watchdog said that it had enjoyed a significant response to its initial consultation, which resulted in 240 written responses. The regulator said it had been combing over the submissions since the consultation closed in January, but was adjusting the dates to “take account of the significant response.”
In previous communications, the regulator suggested that around a third of investment funds would not qualify as sustainable under their current guise.
“It is expected that some firms may make changes to their products to meet the criteria for being a sustainable investment, whilst other funds may choose to operate without sustainability disclosure labels,” said Nicola Pangbourne and Ann Dingemans of law firm Kennedys.
“Most of the requirements will not come into force until June 2024 to provide firms with sufficient time to consider their products against the proposed labelling criteria required and choose whether to label their products accordingly.”
In their written analysis, Pangbourne and Dingemans warned that the rules around anti-greenwashing may still come into force earlier than June 2024, however.