In view of the large number of possible sustainability strategies, thematic orientations and due to the lack of general definitions, classifications and measurement methods, establishing transparency for sustainability-related Swiss collective investment schemes poses a problem.

In practice, FINMA regards the following scenarios as greenwashing
(deception) in the area of Swiss collective investment schemes or at least sees a potential greenwashing risk due to the lack of transparency vis-à-vis investors:

  • The collective investment scheme makes reference to sustainability, although no sustainable investment strategy/policy is actually pursued.
  • The collective investment scheme makes reference to sustainability and information about the sustainability approach used is provided in the investment strategy/policy (e.g. For investors, this means that a significant proportion of the assets will not be used in the way they are entitled to expect.
  • The collective investment scheme makes reference to sustainability, but the investment strategy/policy is only deemed to be sustainable because of exclusionary criteria that are already widespread, without there being a specific sustainability component going beyond this.
  • The collective investment scheme makes reference to sustainability by using terms such as “impact” or “zero carbon” without the stated impact or savings being capable of being measured or verified.
  • The collective investment scheme makes reference to sustainability, but the fund documents do not provide or only provide very general information about the corresponding investment strategy/policy and/or the selection of permitted investments, along with how sustainability considerations are integrated into the investment decision process.
    Investors are not able to gain an impression of how sustainability is taken into account due to the lack of detail or transparency.
    Retrospective sustainability reports should be published setting out clearly and transparently for investors to what extent a sustainability-related Swiss collective investment scheme has achieved its sustainability goals. These should also be reviewed as part of independent monitoring of risks.
  • Specialist expertise and knowledge: It should be ensured that the
    requisite specialist expertise and the necessary knowledge in the area of sustainability is present not only within the body for governance,
    supervision and control, but also across the operational level as a whole.
  • Sustainability strategy: It should be ensured that the body for
    governance, supervision and control specifies the relevant strategy in
    relation to sustainability.
  • Sustainability-related data, tools and ratings: When selecting and using external sustainability-related data and analyses, tools and ratings, adequate assessment and monitoring of the data providers and validation of the corresponding information should be ensured.

The adequacy of the organisational structure is dependent, in particular, on the sustainable strategy for the sustainability-related Swiss or foreign collective investment scheme being guaranteed and also on sustainability risks being captured as part of the risk management process, alongside the traditional investment risks.

The advisory process (at the point of sale) can also pose greenwashing risks if sustainability-related financial products are offered.

Source

FINMA Guidance 05/2021 as PDF