The European Securities and Markets Authority (ESMA) has finalized new guidelines to tackle greenwashing in the investment sector. These guidelines require that at least 80% of investments in ESG or sustainability funds meet specific environmental, social, or governance criteria. The rules also set exclusion criteria for various sustainability-related terms to prevent misleading fund names. Scheduled to take effect three months after publication, with a six-month transitional period for existing funds, these measures aim to protect investors from unsubstantiated sustainability claims and enhance transparency and credibility in fund naming. For further details, visit the ESMA website.
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