Implementing sustainable finance for asset managers, distributors and customers

ESG or Sustainable Finance, is being implemented in the UK through MiFID II for advisers and distributors by changes to suitability rules. It is being implemented for asset managers and other investors also through changes to MiFID as well as changes to shareholder rights and obligations.

This affects what asset managers must demonstrate they do, through the obligations of trustees and distributors, to the expectations of customers to understand the impact of their investments.

How will customers be able to meaningfully compare the ESG impact of funds? And how will firms be able to measure their funds in an objective way? These are the challenges the industry must face up to, with less than 18 months to MiFID II implementation from January 2021 and sooner for suitability.

The Governor of the Bank of England, with the Governor of the Bank of France, wrote a joint editorial on the importance of Sustainable Finance. They think it’s important. So should you… if you run funds for retail distribution, or for institutional investors; or if you distribute funds to retail customers