Fund managers to count climate risks in investment schemes: SFC

The SFC has concluded talks on climate-related risks in funds.

Fund managers will be required to consider climate-related risks in their investment and risk management processes, the Securities and Futures Commission (SFC) said.

This comes after the SFC concluded consultations on the proposed amendments to the Fund Manager Code of Conduct.

“Asset managers play a key role in providing investors with quality and comparable information about climate-related risks,” said Julia Leung, the SFC’s Deputy Chief Executive Officer and Executive Director of Intermediaries.

“The requirements will help channel investment capital to companies with sustainable goals and facilitate the transition to a low carbon economy.”

The SFC received wide support from the industry for financial regulators to play a role in setting baseline requirements for managing climate-related risks and combating greenwashing.

The SFC also made reference to the Task Force on Climate-related Financial Disclosures Recommendations in developing the requirements.

It also considered the global regulatory trend towards harmonisation and comparability of standards across jurisdictions.

The new requirements will be implemented in phases with the first phase to begin on 20 August 2022.