CFA Institute launches global ESG standards

The CFA Institute, a global not-for-profit association of professional investors, launched the Global ESG Disclosure Standards for Investment Products. The purpose of the Standards is to facilitate fair representation and full disclosure of the consideration of ESG aspects of an investment product in its objectives, investment process and management.

According to CFA, a wide variety of investment products that consider ESG aspects are available in the market, and it is complex to classify these products into properly defined categories. In addition, the terminology associated with incorporating ESG approaches into investment products is not standardised.

The Standards will help investors, consultants, advisors and distributors to better understand, compare and evaluate investment products and reduce the potential for “green washing”. They are designed to accommodate the full range of investment vehicles, asset classes and ESG approaches offered in markets around the world. In addition, they address current gaps in regulation, helping to harmonise disclosure practices in different markets.