The SEC’s Green Name Game

Source: Cato Institute
by Jennifer J Schulp

“While determining what ‘green’ means — or what qualifies as such — is not a new endeavor, the Securities and Exchange Commission (SEC) has recently begun to wrestle with it for investment products. As funds advertising themselves as green or ESG (environmental, social, and governance) reap record inflows, there’s growing concern that investments may not be as environmentally or socially ‘responsible’ as the products’ marketing implies. … Everyone agrees that investors should not be deceived; that’s why the SEC already has plenty of tools at its disposal to ensure that funds live up to their promises to investors. Yet classifying investments as green or sustainable seems to be an entirely separate matter — far beyond the SEC’s remit and its capabilities.” (01/14/22)