The Anti-Greenwashing Rule: Understanding and Managing the Risk

Introductions

• Welcome to the session, agenda and objectives of the Anti-Greenwashing Rule

What is Sustainability?

• Understanding sustainability

• Evolving client priorities

Greenwashing

• Definitions

• How greenwashing can occur

Current Regulatory Position

• Sustainability Disclosure Requirements

• The EU equivalent – Sustainable Finance Disclosure Regulation (SFDR)

• The four sustainability labels

• Product descriptors and associated rules

• The Financial Conduct Authority (FCA) commentary on greenwashing

• The Advertising Standards Authority – additional detail

The Anti-Greenwashing Rule: Effective May 31st, 2024

• Claims need to be correct and capable of being substantiated

• Claims are required to be clear and presented in a way that can be understood

• Claims should be complete and not omit or hide important information

• Comparisons should be fair and meaningful

• Links to the existing Financial Promotions rules

• Sessions illustrate both good and poor practices through practical, real-world examples

Greenwashing in Practice

• Seven deadly sins of greenwashing

• Plus four more

• Case studies – where firms got it wrong and how to avoid it

Summary

• Course wrap-up

• Q&A

• Open forum

Training Objectives

Training at Redcliffe provides a clear understanding of the FCA’s expectations regarding sustainability claims and how to ensure communications remain fair, clear and not misleading. Through practical analysis, real-world examples and regulatory insight, the programme helps firms identify, manage and prevent greenwashing risks across their operations while supporting compliance with the FCA's anti-greenwashing guidance:

• Training includes the discussion and determination of why greenwashing is a significant regulatory issue for the FCA.

• The risks to consumer protection posed by the misrepresentation of sustainability claims.

• Participants learn specifically what greenwashing is, with relevant examples to illustrate its harmful effects.

• Evaluating 'risky terminology' and recognising language that can be confidently used in sustainability contexts

• The importance of referring to the relevant international regulations guiding sustainability claims and greenwashing prevention when required.

• Explanation of the rule effective May 31st, 2024 and its implications for firms in terms of compliance and best practices.

• Connecting these requirements to existing COBS and Financial Promotions rules.

• Sessions identify and explore common greenwashing typologies that firms must avoid.

Training Course Summary

Following the introduction of the EU regulation, the FCA published its own Sustainability Disclosure Regulation, which includes an anti-greenwashing rule, taking effect as of May 31st, 2024. Additional guidance was issued in April of the same year, and Redcliffe’s training covers this.

As consumer demand for sustainable products grows, firms are under increasing pressure to be perceived as ‘green.’ However, failing to meet these expectations can lead to significant reputational damage and financial losses. Such pressure may tempt some firms to engage in greenwashing - repackaging an existing product as sustainable, misleading consumers into believing it meets their environmental or sustainability goals. Such practices not only pose a risk to consumers but also harm the industry’s reputation whilst undermining the integrity of the marketplace.

Training gives participants a solid rationale for developing their own internal anti-greenwashing control frameworks.

We consider operational management of sustainable products as well as environmental claims in marketing activity.