Mercer Super sued over alleged greenwashing | WARC | The Feed

Mercer Super sued over alleged greenwashing

The Australian Securities & Investments Commission (ASIC) is taking one of Australia's leading corporate pension funds to court as it cracks down on false sustainability claims.

What’s happening

The move is a first for ASIC, which has previously only fined companies for greenwashing, SmartCompany reports.

• ASIC alleges Mercer Super issued “misleading statements about the sustainable nature and characteristics of some of its superannuation investment options”.
• ASIC notes that ‘Sustainable Plus’ investment options marketed to members who were “deeply committed to sustainability” were described as excluding investments in fossil fuel, alcohol and gambling companies. 
• But ASIC claims the products actually invested in 15 companies involved in fossil fuels, 15 in alcohol, and 19 in gambling.

Why it matters

Greenwashing is increasingly in the sights of regulators around the world (upcoming legislation in the UK, for example, will give powers to the Competition and Markets Authority to impose direct civil penalties on companies making misleading environmental claims). 

Businesses need to take heed (HSBC Bank has said, “We consider greenwashing to be an important emerging risk that is likely to increase over time”).

Ultimately, green credentials have to be about far more than just a marketing strategy. Brands may need to consider major operational changes if they are to avoid being called out and fined by regulators, potentially suffering reputational damage as a result. 

Key quote

“If financial products make sustainable investment claims to investors and potential investors, they need to reflect the true position. If investments in certain industries like fossil fuels are said to be excluded, this promise must be upheld” – Sarah Court, Deputy Chair, ASIC.

Sourced from SmartCompany, WARC