Financial institutions, financial advisors and asset managers (and their insurers) may face mis-selling litigation based on the "greenwashing" of financial products and breaches of investment mandates. We expect the risk of such claims to increase, particularly as more "green" products flood into the market.
There is a growing awareness of environmental issues among investors, financial institutions, asset managers and financial regulators. "Green" products, ranging from ESG funds and green bonds to ethical savings accounts and green home mortgages, are proliferating. COVID-19 has served only to accelerate this already growing trend. There remains uncertainty around the criteria by which products qualify as socially responsible or ethical, and how those criteria are translated into investment decisions.
Our materials on sustainable financing and ESG investment and our note on the Top 10 Things Asset Managers Need to Know about the EU ESG Initiative may also be of interest when considering these risks.
Key contacts
If you have any questions, contact a member of the Mis-selling / Greenwashing claims team for assistance:
