Guidance for Authorised and Registered Collective Investment Schemes on Measures to Counter the Risk of Greenwashing

Summary

This is GFSC guidance addressing greenwashing risk in collective investment schemes authorised or registered under the Protection of Investors (Bailiwick of Guernsey) Law, 2020. It sets out the Commission's expectations for how prospectuses and marketing materials should treat any claims of environmental sustainability, so that such claims are accurate, evidenced and not misleading.

• Scope: Applies to all authorised and registered collective investment schemes and to those responsible for preparing their prospectuses and marketing materials, including scheme particulars and information particulars.
• No misleading claims: Any explicit statements that a scheme or its underlying assets are environmentally sustainable investments must not be misleading and must be based on genuine, evidenced fact.
• Supporting information expected: Where sustainability claims are made, the prospectus should explain how the sustainable investment objective will be achieved, monitored, measured, reported and kept up to date, e.g. taxonomy alignment, proportion of sustainable investments and limits, and benchmarking methodology.
• Disclosure of gaps: If a scheme fails to put such measures in place, that fact should itself be disclosed.
• Consistency in marketing materials: The Commission expects similar transparency in all other marketing materials associated with the scheme, not just the prospectus.
• Evidence on request: The Commission may request evidence supporting sustainability claims during the application process and ongoing supervision, and may take action where claims cannot be substantiated.
• SFDR safe harbour: A scheme making disclosures compliant with the EU Sustainable Finance Disclosure Regulation (SFDR) is deemed compliant with this guidance.

The guidance does not introduce new legal rules but clarifies how existing prospectus disclosure requirements under the POI Law apply to sustainability-related claims, placing responsibility on scheme operators and those preparing marketing materials to avoid facilitating greenwashing, whether intentional or not.

Key obligations

• Ensure any explicit claims that a scheme or its underlying assets are environmentally sustainable investments are not misleading and are capable of being evidenced.
• Where sustainability claims are made in the prospectus, disclose how the sustainable investment objective will be achieved, monitored, measured, reported and kept up to date.
• Disclose the fact where a scheme has not put in place measures to support its sustainability claims.
• Maintain similar levels of transparency regarding sustainability claims in all other marketing materials associated with the scheme.
• Be prepared to provide evidence to the Commission supporting sustainability claims upon application or during ongoing supervision.
• Ensure prospectus and marketing materials clearly disclose information needed for investors to assess whether, or to what extent, the scheme is a truly environmentally sustainable investment.

Applies to

Authorised collective investment schemes, Registered collective investment schemes, Those responsible for preparing prospectuses and marketing materials of such schemes