ESG investments have taken the finance world by storm. The head of The International Stock Exchange (TISE) in Guernsey has warned that that growing interest demands vigilance against ‘greenwashing’. Greenwashing is the practice of making an unsubstantiated or misleading claim about the environmental benefits of a product, service, technology or company practice. Greenwashing can make a company appear to be more environmentally friendly than it really is.

Fiona Le Poidevin said at the ICSA’s annual conference in Guernsey that recent climate change protests in London and the campaign led by schoolgirl Greta Thunberg were a sign that green investments are here to stay. She encouraged companies to focus on accountability, transparency and responsibility in their environmental, social and governance reporting and said that much more capital was needed to address such issues. She also warned that there was a lack of consistency globally in terms of governmental and regulatory responses to ESG and companies are focusing on environmental issues more than on the social or governance aspects.

Simon Osborne, chief executive of ICSA, said the conference had been of great use in flagging up some of the issues that businesses will be faced with in the future. As climate activism increases and the ESG market evolves, companies not paying close attention risk being left behind. Similarly, it is vitally important that boards consider the ethical impact of technological advancements that allow such things as personal profiling.

In response to the surge of interest in ESG investing, CFA UK will launch a new qualification in ESG investing for investment professionals later this year, recognised and supported by the Principles for Responsible Investment [PRI]. The ‘Certificate in ESG Investing’ will be the first formal qualification on ESG investing available sector-wide to investment professionals in the UK. It aims to provide investors with better education, guidance, and standards around the subject. The qualification is modelled on the existing CFA UK’s Investment Management Certificate (IMC), considered the benchmark entry-level qualification for the UK investment profession. The Certificate programme is then expected to be rolled out across Europe