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🗞️ Driving the news: Environmental law group ClientEarth has lodged a greenwashing complaint against BlackRock, accusing the asset management giant of misleading investors by labeling certain fossil fuel-backed funds as “sustainable”
• The legal action, filed with France's financial regulator AMF, challenges over $1 billion in BlackRock's "sustainable" funds, which are invested in companies like Shell and BP
🔭 The context: ClientEarth's complaint marks the first greenwashing case against a financial institution, targeting 18 retail investment funds in France marketed by BlackRock
• The organization argues that labeling investments in fossil fuel companies as sustainable misleads investors and distorts the competition in the sustainable finance market
• The complaint seeks to push for clearer definitions and stricter regulations on what constitutes sustainable investing
🌍 Why it matters for the planet: If successful, the case could set a new precedent in sustainable finance by forcing financial institutions to ensure that investments marketed as sustainable genuinely avoid contributing to climate change
• It would also promote greater transparency and integrity in the sustainable investment sector
⏭️ What's next: The AMF is expected to investigate the claims, with the potential for regulatory enforcement if the complaint is upheld
• ClientEarth also plans to inform the European Securities and Markets Authority, potentially broadening the scope of regulatory scrutiny across Europe
💬 One quote: "Through BlackRock’s so-called ‘sustainable’ funds, investors are unwittingly being exposed to billions in fossil fuel investments, distorting competition in the market for truly sustainable financial products" – Megan Clay, ClientEarth lawyer
📈 One stat: Over $1 billion of BlackRock's “sustainable” funds are invested in fossil fuel companies such as Shell and BP
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