ASX-listed company investigated by ASIC for greenwashing

The corporate watchdog is conducting at least two investigations into “greenwashing”, including a publicly listed company, as it warns businesses and fund managers to avoid overhyping their climate change credentials.

Green finance and superannuation funds will be targeted by the investment regulator in an effort to stop consumers placing their money with underperforming and dodgy companies and money managers, the Australian Securities and Investments Commission revealed in its corporate plan published on Monday.

Global climate change developments in policy and capital markets, and more people living longer, are two of the emerging trends ASIC identifies as reshaping the financial system.

As a consequence, ASIC lists as priorities sustainable finance and protecting retirees from dud superannuation products, managed investments and financial advice.

The other big priorities over the next four years are risks posed by cyberattacks and digital products such as crypto assets, and using ASIC’s product design and distribution powers to tackle risky financial and credit products.

The oversight of sustainability-related disclosure and governance practices includes listed companies, managed funds, superannuation funds, green bonds and carbon markets.

ASIC chairman Joseph Longo told The Australian Financial Review on Monday there was a lot of market “hype” from green promoters.

“One of our priority areas is to really focus on the need to not be misleading and deceptive with their marketing and how they promote products,” he said.

“If people make outrageous claims about their green credentials and don’t have anything to back them up, that’s not something we are going to tolerate.

“We’re doing a lot of surveillance and we have a couple of matters under active investigation so you can expect us to be taking focused action.”

It is understood ASIC has inquiries underway into several listed entities, super funds and managed funds, with some at very early stages and others that are more advanced.

ASIC wants to ensure legitimate green finance players are not competitively disadvantaged by greenwashers so businesses can operate on a level playing field.

It is working closely with global regulators and standard setters on climate-related disclosures by companies and market participants.