EU sets new obligations for asset managers to avoid greenwashing

FILE PHOTO: Workers adjust and clean the logo of the European Commission at the entrance of the Berlaymont building, the EC headquarters, in Brussels September 12, 2013. REUTERS/Yves Herman

BRUSSELS (Reuters) - The European Commission proposed on Thursday new rules to force asset managers to disclose how they take into account environmental risks in their investments and abide by new, precise criteria when they claim “green” credentials.

The plan is meant to spur green investment and to curb “greenwashing”, a practice whereby companies and other organizations claim to be more environmentally friendly than they really are.

“We want to establish an EU-wide classification system for sustainable activities, to provide common definitions for what is green and what is not. This is a ground breaking step,” the EU commission’s vice-president Valid Dombrovskis said.

Reporting by Francesco Guarascio; editing by Philip Blenkinsop