Responsible finance has become a major business focus for asset managers. The Autorité des marchés financiers wants to ensure the sincerity of marketing discourse, but there is no consensus on its new doctrine.

Could “greenwashing” disappear in French financial products? In any case, this is the objective of the Autorité des marchés financiers (AMF) which published a new doctrine on Wednesday morning governing the information to be provided to investors for collective investments claiming to be responsible finance. “Management companies are subject to an obligation of clear, accurate and non-misleading information, ‘greenwashing’ does not respect this principle”, underlined Benoît de Juvigny, secretary general of the AMF.

Green finance has quickly become a business priority for asset managers. While the popularity of traditional equity funds shrinks year after year, funds that integrate environmental, social and governance (ESG) criteria into their management are doing well. And the managers’ marketing efforts are clear: more 20% of financial product ads featured sustainable finance last year.

Warning for foreign funds

All funds marketed to individuals in France are subject to this doctrine from the moment a sustainable finance term is put forward in their communication (name of the fund, key information document, etc.). They must therefore mention in their legal documentation “measurable objectives” for taking into account extra-financial criteria and demonstrate that these have a “significant” effect. AMF approval will depend on compliance with this doctrine for French funds. Non-compliant foreign funds will have to include a warning from the AMF in their commercial documentation. The doctrine applies immediately to the new funds and will have to be applied for the most part by all the existing funds by the end of November.

The simple integration of an ESG analysis in the management will not be enough to be able to communicate on the “responsible” character of a fund: “an approach by ESG risks is not sufficient”, indicated Bastien Rosspopoff of the management of AMF asset management. The funds concerned must mention that their integration of ESG criteria is “non-binding”. To appreciate the seriousness of the manager’s approach, the AMF has partly adopted the criteria of the French SRI label, which requires a 20% reduction in the investment universe, without however limiting green communication to only labeled funds. .

Threat to the SRI label

It is precisely this possibility open to non-labeled funds to continue to sell themselves as “responsible” that worries some players. “By not relying on the SRI label, the AMF is putting itself in a position to be a judge itself”, regrets Philippe Zaouati, chairman of Mirova, a manager specializing in responsible finance, who notably asks himself the question. resources that will be devoted to this new mission. For him, France, which was ahead of green finance issues, is no longer the best-seller.

“If the AMF’s announcement is still positive, this choice does not reflect a market consensus,” he shouts, referring to the possibility for Mirova to give up labeling its funds in the future: “with this doctrine, the AMF signs the label’s death warrant ”. Likewise, for the president of the Forum for Responsible Investment Alexis Masse, “the absence of control by a third-party verifier represents a step back from the requirements of the label which worries us”. The AMF will therefore not pass judgment on the quality of the extra-financial data used by the managers or even on the actual effect of the methodologies used.

The AMF doctrine is evolving and will adapt in particular to the evolution of European texts, but the first modification envisaged by the financial market policeman is not likely to reassure the world of responsible finance. It is therefore considering authorizing “intermediary” forms of communication for funds that do not meet its new requirements.

Europe publishes its green taxonomy

The European Commission is also making progress in its framework for green finance. It published on Monday the final version of the “green taxonomy” which defines the environmental character of economic activities. This classification should in particular serve as a basis for the development of a European label for sustainable funds. Certain activities continue to give rise to debate: nuclear power thus remains excluded, even if the experts appointed by the Commission are calling for additional work on the subject.