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BlackRock notifies investors of changes to over 100 ESG funds

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By illuminem briefings

· 2 min read


illuminem summarises for you the essential news of the day. Read the full piece on The Edge Singapore or enjoy below:

🗞️ Driving the news: BlackRock has informed investors of changes to 135 ESG-labelled funds in response to new EU rules from the European Securities and Markets Authority (ESMA)
The changes include adjustments to fund names, investment methodologies, and exclusion criteria to comply with stricter ESG naming requirements
The revisions impact over US$185 billion in assets under management

🔭 The context: ESMA now requires that funds using ESG-related terms in their names invest at least 80% in aligned assets, and at least 50% in sustainable assets if using sustainability-specific terms
The regulations aim to curb greenwashing and bring consistency across the EU’s sustainable finance market
Asset managers across Europe are undergoing similar changes, with dozens already dropping ESG labels from funds

🌍 Why it matters for the planet: Stricter fund labelling rules help ensure ESG investments are credible and transparent
Improved standards can rebuild trust in sustainable finance and prevent the misallocation of capital into funds that do not meet ESG criteria
This move strengthens the EU’s position as a global leader in regulating green finance

⏭️ What's next: More asset managers are expected to adjust fund labels or investment approaches to remain compliant
Regulatory scrutiny will likely increase across other jurisdictions
Investors may increasingly shift capital based on stricter and more meaningful ESG classifications

💬 One quote: “The sustainability characteristics of 60 funds with assets of US$92 billion were enhanced, including adoption of exclusions required for funds with sustainability-related words in their names.” – BlackRock letter to investors

📈 One stat: BlackRock is modifying 135 funds in response to ESMA rules, impacting over US$185 billion in assets under management

See here detailed sustainability performance of companies like BNP Paribas and AXA 

Click for more news covering the latest on ESG 

 

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