Fund Managers Start Axing ESG Buzzword as Greenwash Rules Bite
Some of Europe’s biggest asset managers are starting to drop a once-ubiquitous ESG label from their company filings amid concern that regulators will no longer tolerate vague descriptions of environmental, social and governance investing.
Money managers including Allianz and DWS have either stopped using the catch-all term “ESG integrated” in their public documents or are playing down its relevance in interactions with investors, according to people familiar with the matter who asked not to be identified discussing internal changes. They said the language choice followed new European disclosure rules.
It’s the latest sign that Europe’s landmark anti-greenwash rulebook is reining in an industry that ballooned to more than $35 trillion last year. The Sustainable Finance Disclosure Regulation was enforced in March, but already in the lead-up to its arrival, European investment managers stripped the ESG label off $2 trillion in assets in anticipation of stricter rules.