Matching rhetoric to reality in values-based investment
FMA director of enforcement Paul Gregory posed the question at the RIAA (Responsible Investment Association Australasia) 2023 conference held in Auckland last week: while there is harm from poor returns, risk management and value for money over an investment horizon, what is the ethical equivalent of failing to live up to your investment goal? And how do you regulate that?
He said views on harm have become more complex for regulators and the industry due to rapid changes in public expectation both formally, through laws and standards, and informally.
Once investors have had an “ethical jumpscare” and scratched below the surface of their portfolio, how can those informal expectations be given the same weight as formal ones?
Greogry said there is significant confusion around what should and should not be invested in and what is a regulatory issue. “Greenwashing is a fair dealing issue,” he said.
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