On 21 August, ESMA (the European Securities and Markets Authority) published on its website the translation into all official EU languages of the Guidelines regarding fund names containing ESG terms, or terms related to sustainability.
The purpose of the Guidelines – which will come into force on November 21st of this year – is to ensure greater investor protection by preventing the use of unfounded or misleading expressions in the context of sustainability, as well as to provide asset managers with clear criteria to assess their ability to use such ESG terms.
The Guidelines apply immediately to all new funds set up after they come into force; instead, a transitional period of 6 months starting from the date the guidelines come into force will be granted to pre-existing funds to comply with the new Guidelines.