Ahead of the InvestorDaily ESG Summit 2023, gold partner Russell Investments’ managing director, head of adviser and intermediary solutions Australia, Neil Rogan said that it is important for companies to focus on fair disclosures to stamp out greenwashing.
Moreover, advisers and investors must be able to access these disclosures, he insisted.
In addition, Mr Rogan called on companies to produce accurate reporting so that fund managers, advisers, and investors are able to avoid companies that are potentially overstating their green credentials.
“This goes back to almost a four-party model here where you’ve got investors like ourselves, you’ve got clients and advisers, and you’ve got associations as well as regulators that ensure that there’s clarity, fairness, accuracy, and disclosure,” he told InvestorDaily.
Indeed, the Australian Securities and Investments Commission (ASIC) has said that it will be closely monitoring organisations’ misleading conduct and claims of greenwashing that cannot be sustained as part of its priorities in 2023, and vowed to take enforcement action where necessary.
It has already begun taking action against organisations which misrepresent the extent to which their financial products or investment strategies are environmentally friendly, sustainable, and ethical.
It launched its first court action against Mercer Superannuation (Australia) for alleged greenwashing conduct.
Mr Rogan also suggested that the Responsible Investment Association Australasia (RIAA) and other investor groups provide clarity for investors and fund managers around companies and products that may be engaging in greenwashing.
“From an investor and fund manager’s point of view, understanding what you’re investing in and having clarity around what we’re including and excluding is really important,” he said.
“So, I think the RIAA website is a great source of information to help investors with that.”
Casting his eyes towards the future, Mr Rogan said that while Australian investors have gravitated towards environmental issues due to being prone to natural disasters such as floods, droughts, and bushfires, it could gradually tilt towards the social and governance aspects of ESG investing as well.
“If we look at the US, they’re focusing more on the S and the G and less on the E,” he noted.
“But we’ll start to see more of that emerging in Australia. It won’t be a significant shift but it will happen. Indeed, we’re already seeing it in the companies that we invest in, and they represent the broader market they operate in. I think it will just become the way they do business to be in line with the expectations of both investors and the broader community.”
Mr Rogan’s comments have preceded the 2023 ESG Summit, which Russell Investments is supporting as a gold partner.
Speaking about the reason for partnering with InvestorDaily, Mr Rogan said the summit provides an opportunity for the asset manager to share new insights, knowledge, and capabilities with key stakeholders.
Moreover, the summit offers a chance for advisers to learn about how the ESG landscape has evolved, and the service offerings from asset managers, he added.
“For advisers, it’s really important for them to know what’s available in the market to meet the needs of their clients and this event showcases that,” Mr Rogan concluded.
To hear more from a range of speakers about the evolution of ESG, the investment outlook for 2023 and beyond, and how advisers could incorporate ESG investing into their client conversations, come along to our jam-packed ESG Summit 2023.
It will be held on 23 March at Aerial UTS Function Centre Sydney and on 29 March at Grand Hyatt, Melbourne.