CFA Institute Releases Global ESG Disclosure Standards for Investment Products

CFA Institute, the global association of investment professionals, announces the release of the first voluntary Global ESG Disclosure Standards for Investment Products (“the Standards”) designed to enable investors, consultants, advisors, and distributors to better understand, compare, and evaluate ESG investment products.

Today’s release follows an industry-wide consultation to create Standards that are based on the principles of fair representation and full disclosure of environmental, social, and governance issues within the objectives, investment process, and stewardship activities of investment products. The Standards apply to all types of investment vehicles, asset classes, and ESG approaches, and aim to support investors with information that is complete, reliable, consistent, clear, and accessible.

Margaret Franklin, CFA, President and CEO, CFA Institute, comments:

“We’re proud to release the first edition of the Standards after a multi-stage development process to ensure the result is additive, has impact, and is meaningful to the industry. The complexities of the ESG investing landscape remain vast. We must identify ways to mitigate greenwashing and preserve the integrity of the information being shared about ESG investment products to make them more understandable and comparable to the end investor. The release of the Standards marks one step in the broader efforts to make that a reality -- and we believe an important one.”

Paul Andrews, Managing Director for Research, Advocacy, and Standards at CFA Institute comments:

“Although there are differing regulations in global markets to address transparency for investors on ESG matters, it is critically important that a harmonized, global approach exists to enable investor protection. Furthermore, such regulation does not always comprehensively cover all market participants.  The Standards fill these market needs on a global scale, facilitating important disclosures that will drive greater communication between the buyers of investment products and an industry marketing increasing numbers of funds and strategies that offer an ESG-centric approach.”

Two rounds of public consultation informed the first edition of the Global ESG Disclosure Standards for Investment Products. In August 2020, CFA Institute published an initial Consultation Paper seeking industry, regulatory, and public comment on the proposed scope, structure, and design principles for the Standards. In May 2021, CFA Institute released an Exposure Draft of the Standards. The Standards are jointly approved by CFA Institute and its ESG Technical Committee, chaired by Bruno Bertocci, Managing Director, Head of Sustainability in Active Equities, UBS Asset Management, United States. Industry leaders who have volunteered to serve on the CFA Institute ESG Technical Committee, ESG Verification Subcommittee, and ESG Working Group have been instrumental in the development of the Standards.

To view the Global ESG Standards for Investment Products, including sample ESG Disclosure Statements, visit: here. 

For further information, please contact [email protected]