Global Survey of ESG Regulations for Asset Managers: ESG and the Sustainable Economy Handbook

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Australia, European Union, Global, Hong Kong, United Kingdom, USA February 19 2026

GLOBAL SURVEY OFESG REGULATIONS FORASSET MANAGERSESG and the Sustainable Economy HandbookUpdated 19 February 2026TABLE OF CONTENTSINTRODUCTION .......................................................................................................................1What is New?..............................................................................................................................................3Americas...................................................................................................................................4United States...............................................................................................................................................5Asia ...........................................................................................................................................9Hong Kong ................................................................................................................................................10Japan.........................................................................................................................................................16Singapore..................................................................................................................................................20Australia...................................................................................................................................26Europe.....................................................................................................................................35European Union ........................................................................................................................................36United Kingdom.........................................................................................................................................43Conclusion...............................................................................................................................48Endnotes .................................................................................................................................50Glossary ..................................................................................................................................52Editors and Authors .................................................................................................................56INTRODUCTIONESG and the Sustainable Economy—19 February 2026 2INTRODUCTIONAsset managers (i.e., investment advisers) offeringfunds in more than one country are accustomed toadapting to different regulatory requirements.However, the challenges presented by the globalregulation of ESG investing strategies are presentinga particularly arduous burden, especially as countries'approaches to ESG regulation become more varied.Not only do investor demands differ among countries,but the regulators and other controlling bodies haveimposed, or proposed to impose, differentrequirements that will impact approaches to investingfund assets, disclosures, and marketing, even withrespect to the same strategies. While the approachesand goals can vary across jurisdictions, one messageis universal in all languages: Regulators want assetmanagers to say what they do and do what they say.Some regimes seek to accomplish this with specificESG labeling or other requirements, while others arecurrently relying on existing rules prohibiting fraud andmaterial misrepresentations.To help asset managers keep up with the currentregulatory landscape and get a comparative sense ofthe requirements and common issues in variousregions, our lawyers—located in the Americas (theUnited States), Asia (Hong Kong, Japan, andSingapore), Australia, and Europe (the EuropeanUnion, including Ireland and Luxembourg,1 and theUnited Kingdom)—have provided an overview ofregional regulations by responding to the same eightquestions regarding the existing ESG-related rulesand ESG developments impacting the investmentmanagement industry. We summarize, among otherthings, each country or region's position on ESGrelated labeling and categories, investmentrequirements, disclosure and reporting requirementsand restrictions for offshore products, as well as otherESG-related initiatives that could impact assetmanagers doing business in that country or region.Taken together, this publication provides a high-levelview of the overall global ESG regulatory landscape,allowing managers to think strategically about howtheir firms can navigate this changing environmentand effectively approach their business activities inthe various regions in which they offer services.While we expect that governments will continue toaddress ESG concerns by amending existing orimposing new rules at a rapid pace, the followingsummary responses are designed to provide assetmanagers—particularly those with an internationalbusiness—with a helpful guide, based on practicalexperience, to current requirements and trendsimpacting their services and products, as well as offerpractical insight into how they can seek to straddle thevarious regulatory regimes.ESG and the Sustainable Economy—19 February 2026 3WHAT IS NEW?The global landscape of ESG regulation continues toevolve quickly. Below are some of the key changesthat occurred since the last publication of this surveyon 11 November 2025:United States: While there have been no formalregulatory actions specifically directed toward ESGinvestment management, there have been some keydevelopments of note. In January 2026, the US Houseof Representatives passed legislation that would limitthe use of ESG considerations in managing ERISAassets, but the SEC climate risk disclosure rulesremain in limbo. At the state level, the Californiaclimate risk disclosure rules remain under courtchallenge, and the Ninth US Circuit Court of Appealshas issued an injunction blocking enforcement of oneof the two rules that would require disclosure ofclimate risks.Hong Kong: There have been no new updates sincethe last edition of this survey was published.Japan: There have been no new updates since thelast edition of this survey was published.Singapore: There have been no new updates sincethe last edition of this survey was published.Australia: On 6 November 2025, ASIC issuedinfringement notices to two superannuation trusteesfor misleading statements, reinforcing its continuedregulatory focus on greenwashing. Recentenforcement action demonstrates that broad, absoluterepresentations will be subject to regulatory action.European Union: On 20 November 2025, theEuropean Commission published a proposal to amendthe SFDR. If it proceeds, “SFDR 2.0” would introducea classification framework and labels for sustainabilityrelated financial products and would also makechanges intended to reduce the ESG reportingburden. The proposals are under consideration by theEuropean legislative bodies.Meanwhile, for corporates, progress has been madeon the so-called “omnibus package” to simplify thedisclosure and reporting requirements introduced bythe CSRD and CSDDD. The legislative bodiesreached agreement in December 2025.Asset managers should also be aware of theregulatory framework for ESG ratings providers beingintroduced in the European Union, which will takeeffect in November 2026.United Kingdom: The United Kingdom is movingforward with the introduction of a regulatory regime forESG ratings providers. The legislative framework hasbeen finalized, and the FCA is consulting on the rulesthat will apply to providers of ESG ratings. The regimeis expected to take effect in 2028.For corporates, we are awaiting the outcome of theconsultations on the UK sustainability reportingframework published in June 2025. The proposed UKSustainability Reporting Standards are to be based onthe ISSB published in June 2023.Separately, the UK government has decided not todevelop a UK green taxonomy.AMERICASESG and the Sustainable Economy—19 February 2026 5UNITED STATESBy Lance C. Dial and Keri E. RiemerWHAT RULES, IF ANY, ARE CURRENTLY INPLACE (I.E., HAVE BEEN ADOPTED) FORFUNDS AND ASSET MANAGERS?At the federal level, no formal ESG-specific rule iscurrently in place for funds and advisers (i.e., fundmanagers). In March 2024, the SEC finalized itsclimate risk-related reporting rules applicable to publicoperating companies and other issuers of securities inthe United States. These rules were promptlychallenged in court; however, the litigation is currentlypaused in light of the SEC's determination in March2025 to cease defending the regulations. It is now upto the SEC whether to propose rescinding oramending these rules or to resume defense of therules in court.In addition to SEC reporting requirements, the state ofCalifornia has passed legislation that would requirecompanies “doing business” in California to makecertain disclosures of their emissions and climaterelated risks. These laws, like the SEC's climate riskdisclosure rules, are subject to challenge in federalcourt. In November 2025, the Ninth US Circuit Courtof Appeals, which is hearing the challenge, issued aninjunction prohibiting the state of California fromenforcing one of the laws (SB 261) that wasscheduled to go into effect at the beginning of January2026. This law would have required companies tomake certain climate risk disclosures. The other law(SB 253)—requiring disclosure of Scope 1, 2, and 3emissions data—was not subject to the injunction andis scheduled to go into effect mid-year 2026.Other states have adopted—or are consideringadopting—various laws or regulations that seek toregulate how and whether ESG factors may beconsidered by those conducting business in suchstates. In general, these laws and regulations requireadvisers to consider only “pecuniary” factors, andadvisers that consider ESG factors in investing maybe subject to sanction. Many other states haveadopted legislation that would prohibit the stategovernment from doing business with or investing withfirms that avoid investment in certain industries forESG purposes. Additionally, on 8 April 2025,President Trump issued an executive order directingthe attorney general to identify laws “purporting toaddress 'climate change' or involving 'environmental,social, or governance' initiatives, 'environmentaljustice,' carbon or 'greenhouse gas' emissions, andfunds to collect carbon penalties or carbon taxes” andtake action to prevent the enforcement of such laws.While there are no laws or regulations specificallyrelating to ESG disclosures for funds or advisers as ofthe date of this survey, the currently existing federallaws and rules prohibiting materially misleadingstatements and previously issued guidance from theSEC staff do provide limits and standards for fundsand advisers with respect to their use of ESG factors.In addition, SEC enforcement actions taken in recentyears indicate that the SEC will take a very strict readof ESG-related disclosures and expects that assetmanagers have in place procedures ensuring that anyESG-related processes they describe in funddisclosures or marketing materials are consistentlyfollowed.Existing Rules and GuidelinesAs indicated previously, funds and advisers arecurrently subject to laws and rules that prohibit themfrom making materially misleading statements oruntrue statements of material fact, includingstatements about ESG. Accordingly, funds andadvisers are presently required to provide accuratedisclosures regarding their use of ESG-related factorsin their investment strategies. In May 2021, the staff ofthe SEC issued a risk alert urging funds and advisersto, among other things, establish policies andprocedures related to ESG investing, ensure thatESG and the Sustainable Economy—19 February 2026 6portfolio management practices were consistent withdisclosures about ESG approaches, and implementadequate controls around the implementation andmonitoring of negative screens (e.g., prohibitions oninvesting in tobacco).Advisers are also subject to Rule 206(4)-1 (theMarketing Rule) under the Investment Advisers Act of1940, as amended (the Advisers Act), which wasdesigned to prevent false or misleadingadvertisements by advisers, including in connectionwith the private funds (e.g., hedge funds, privateequity funds) they manage. Accordingly, even in theabsence of a specific ESG rule, funds and advisersare still bound by existing requirements pertaining tomaterial misstatements and omissions, and accuratereporting.WHAT LABELS OR CATEGORIES, IF ANY, ARECURRENTLY REQUIRED OR HAVE BEENPROPOSED FOR FUNDS AND ASSETMANAGERS?There are no labels or categories currently requiredfor funds or asset managers in the United States.With respect to fund names, amendments to Rule35d-1 (setting requirements with respect to fundnames) (the Names Rule) come into effect 11 June2026 for registration statements filed on or after thatdate. Pursuant to the amended Rule 35d-1,a fund witha name suggesting an ESG-related investmentprogram is required to disclose how it defines therelevant terms used in its name and adopt a policy toinvest at least 80% of its assets in investmentssuggested by its name.WHAT DISCLOSURE AND REPORTINGREQUIREMENTS ARE CURRENTLY REQUIREDOR HAVE BEEN PROPOSED FOR FUNDS ANDASSET MANAGERS?There are no ESG-specific disclosure or reportingrequirements applicable to funds or advisers at thefederal level. That said, current regulations effectivelyrequire certain levels of disclosure about materialfacts, including the incorporation of ESG factors.Specifically, a Registered Fund that utilizes ESGfactors in its investment strategies must disclose howsuch factors are used and any risks related to itsESG-related strategies in its registration statementand, if applicable, shareholder reports. Likewise, anadviser that employs one or more ESG strategies informulating investment advice or managing assets isrequired to disclose information regarding suchstrategies (and related risks if such strategies are“significant”) in its Form ADV Part 2A (i.e., brochure),but there are no specific ESG-related requirements.ARE THERE ANY CURRENT OR PROPOSEDREQUIREMENTS OUTSIDE OF DISCLOSUREAND REPORTING (E.G., PRODUCT-LEVELINVESTMENT REQUIREMENTS)?The Marketing Rule (with respect to advisers) andantifraud rules currently apply to funds and advisers inconnection with their ESG-related statements andinvestment activities. Existing rules under the AdvisersAct and the Investment Company Act of 1940, asamended, relating to compliance programs imposecertain obligations on advisers and Registered Funds,respectively, that could require funds or advisers toincorporate ESG elements into their complianceprograms. Notably, under the Names Rule,a Registered Fund with ESG terminology in its namewill be required to invest at least 80% of its assetsconsistent with its name.DO THE EXISTING OR PROPOSED RULESAPPLY EQUALLY TO OFFSHORE FUNDSBEING MARKETED IN THE UNITED STATES,OR DO THEY APPLY SOLELY TO LOCALLYDOMICILED PRODUCTS?Non-US funds may only be offered in the UnitedStates on a private placement basis and pursuant tocertain securities law exemptions. While such offshoreESG and the Sustainable Economy—19 February 2026 7funds would not be subject to the rules impactingRegistered Funds, they would be subject to theprohibitions against misrepresentations describedpreviously.ARE ANY RULES IN PLACE FOR INVESTORS(VERSUS FUNDS AND FUND MANAGERS)?The SEC has not proposed or adopted specific rulesfor nonfund investors, such as natural persons.ERISA has provisions that impact how ESG factorsmay be considered for retirement plans. However, theUS Department of Labor, which is responsible foroverseeing ERISA, has indicated in court filings that itis considering rescinding rules relating to theconsideration of ESG factors. That said, the USHouse of Representatives has passed a bill that wouldeffectively prohibit the consideration of ESG factors inconnection with the management of ERISA planassets, although it does not appear that this bill willpass the Senate at this time.ARE THERE OTHER ACTIONS OR INITIATIVESTHAT COULD IMPACT FUNDS ANDMANAGERS?The climate risk-related reporting rules describedpreviously would have required US public operatingcompanies and other issuers to include certaindisclosures regarding the financially material climaterisks associated with their businesses and operations,including by requiring Scope 1 and Scope 2 emissionsinformation. As noted, these rules are not likely tocome into force.The SEC staff revised some guidance relevant toESG managers relating to larger ownership reportingin the United States. In short, entities that own orcontrol more than 5% of an issuer's voting securitiesare required to make a filing with the SEC notifyingthe SEC (and the public) of this ownership. This filingis made in Schedule 13D, but “institutional investors”that invest passively may file on a shorter form knownas Schedule 13G. In February 2025, the SEC staffissued revised interpretations of the relevant rulesclarifying its view that a shareholder that “exertspressure” on an issuer's management to implementspecific measures or changes to a policy may be“influencing” control over the issuer, and thus wouldnot be able to file on Schedule 13G. Although notovertly stated in the updated guidance, this changehas been interpreted as targeting investors that usethe engagement process to pursue ESG-relatedgoals.In addition, various US states, such as California (asdescribed previously), have been adopting their ownlegislation that impacts how ESG factors can beconsidered. While the legislation takes several formsand key details differ from state to state, the laws tendto share core common features. First, those passed todate apply only to the disposition or management ofstate funds (e.g., who the state can hire, in whichcompanies the state can invest, or what standardsmust be applied by fiduciaries who are investing statemoney, particularly the assets of state pension plans).Second, with respect to the management of statefunds, the state laws generally limit the considerationof ESG factors to financial or “pecuniary” decisionmaking. In other words, even in states that haveadopted laws presumably restricting the considerationof ESG factors, there remains room for investmentmanagers to make decisions on investments basedon ESG factors so long as that consideration isgrounded in the pursuit of financial returns. On theother hand, these state laws most likely prohibit statesfrom investing in impact investment strategies.Federal lawmakers and states have also focused onasset manager participation in ESG-related groupinitiatives, such as Climate Action 100+ and the NZAMinitiative. First, in November 2024, a group of states,led by the state of Texas, filed suit against a trio oflarge asset managers citing antitrust concerns arisingfrom their participation in both of these initiatives. Thissuit remains ongoing.ESG and the Sustainable Economy—19 February 2026 8These developments reflect an accelerating effort bylawmakers and state enforcement officials to lookclosely at asset manager participation in groupinitiatives for compliance with fiduciary duties andantitrust principles.WHAT IS ON THE HORIZON?There are no ESG-related rules currently proposed foradoption, and it is not likely that the SEC's climate riskreporting rules will come into effect. It is also not likelythat the new SEC commissioners will prioritize ESGregulation over other initiatives, so little is likely tochange in the near term. At the state level, althoughstates continue to consider and adopt anti-ESGlegislation, they largely follow the existing forms thatgenerally do not prohibit the consideration of ESGfactors where those factors are financiallymaterial. The largest questions concerning ESGregulation in the United States relate to the fate of theclimate risk and emissions reporting requirementsadopted by the SEC and passed by the state ofCalifornia.ASIAESG and the Sustainable Economy—19 February 2026 10HONG KONGBy Anson Chan, Alvin Lam, and Sook Young YeuWHAT RULES, IF ANY, ARE CURRENTLY INPLACE (I.E., HAVE BEEN ADOPTED) FORFUNDS AND ASSET MANAGERS?Currently, there are prescribed ESG rules for fundsthat have been authorised by the SFC to be marketedto retail investors in Hong Kong and that considerESG or sustainability factors (including climatechange) in their investment process (Hong Kong ESGFunds). As described in greater detail below, HongKong ESG Funds are subject to certain disclosure andreporting requirements, as currently set out in theSFC's “Circular to management companies of SFCauthorized unit trusts and mutual funds - ESG funds,”which took effect 1 January 2022.The SFC maintains on its website a database of HongKong ESG Funds. The database is categorisedaccording to the investment theme (e.g., climatechange, environmental, sustainability, food security,forestry, nutrition, social, sustainable energy, andwater) and investment strategy (e.g., best-in-class,positive screening, impact investing, and thematic), ineach case as disclosed in the applicable Hong KongESG Fund's offering document. UCITS authorised bythe SFC will be considered Hong Kong ESG Funds ifthey incorporate ESG factors as their key investmentfocus and reflect such in their investment objectives orstrategies. This is irrespective of whether they areclassified as falling under Article 8 or Article 9 of theSFDR.Fund managers that are SFC-licensed intermediariesare subject to certain conduct rules. In particular, fundmanagers with investment discretion over collectiveinvestment schemes, including both SFC-authorisedfunds (i.e., funds authorised to be marketed to retailinvestors) and private funds (i.e., hedge funds), arerequired to take climate-related risks intoconsideration as part of their investment and riskmanagement processes and to make appropriatedisclosures. These requirements, which largely reflectrecommendations and proposals of the FinancialStability Board's TCFD, were imposed pursuant to theSFC's Consultation Conclusions on the Managementand Disclosure of Climate-Related Risks by FundManagers, which took effect 20 August 2022.WHAT LABELS OR CATEGORIES, IF ANY, ARECURRENTLY REQUIRED OR HAVE BEENPROPOSED FOR FUNDS AND ASSETMANAGERS?While no ESG investment labels or categories havebeen established for either SFC-authorised funds orprivate funds, there is a general requirement thatlicensed intermediaries must ensure that their productdisclosures are not misleading. Accordingly, ESGrelated names may only be used for products wheresuch ESG-related considerations are applied in theinvestment process. In addition, there is a generalrequirement that a product's name must not bemisleading, and references to ESG or related terms inan authorised fund's name or marketing materialsshould be accurate and proportionate. A fund thatdoes not satisfy the definition of a “Hong Kong ESGFund” (set forth above) would generally not bepermitted to name or market itself as ESG related.WHAT DISCLOSURE AND REPORTINGREQUIREMENTS ARE CURRENTLY REQUIREDOR HAVE BEEN PROPOSED FOR FUNDS ANDASSET MANAGERS?While there are currently no prescribed ESG-relateddisclosure or reporting requirements for non-SFCauthorised funds, as noted previously, intermediariesare required to ensure that their product disclosuresare not misleading.ESG and the Sustainable Economy—19 February 2026 11Unlike in some other regions, where specific ESGrelated disclosures are not yet required, Hong KongESG Funds are currently required to make variousESG-related disclosures in their respective offeringdocuments. Such required disclosures includeinformation about the ESG focus or investment themeof the fund; the criteria used to measure theattainment of such focus or investment theme; theinvestment strategy and methodologies adopted(including any exclusion policies); the expected orminimum asset allocation to the designated ESGfocus; any applicable reference benchmarks oradditional information references used by the fund;and any risks or limitations associated with the fund'sESG focus. In addition, the Hong Kong ESG Fund orits manager must disclose to investors on its websiteor via other means, and review and keepupdated certain additional information, including howthe Hong Kong ESG focus is measured andmonitored (and related internal and external controlmechanisms); details regarding the due diligencecarried out in respect of the fund's investments; adescription of the fund's engagement policies(including proxy voting); and a description of thesources and processing of ESG data upon which thefund relies (including any assumptions made whendata is not available).In addition, a Hong Kong ESG Fund is required toconduct periodic assessments at least annually onhow it has attained its ESG focus and then disclose toinvestors the results of such assessments byappropriate means (e.g., in annual reports).In particular, the Hong Kong ESG Fund shoulddisclose—such as in its annual report—the proportionof underlying investments that are commensurate withits ESG focus; the proportion of the investmentuniverse that was eliminated or selected as a result ofESG-related screening; a comparison of theperformance of the fund's ESG factors against anydesignated reference benchmarks; and informationabout actions (such as shareholder engagement orproxy voting activities) taken by the fund to attain itsESG focus.UCITS that are authorised by the SFC are generallysubject to a streamlined regulatory approach. AUCITS fund authorised as a Hong Kong ESG Fundthat meets the disclosure and reporting requirementsfor Article 8 or Article 9 funds under the SFDR will bedeemed to have generally complied with the HongKong disclosure and reporting requirements for HongKong ESG Funds.As noted previously, fund managers with investmentdiscretion over collective investment schemes arerequired to take climate-related risks intoconsideration in their investment and riskmanagement processes and to make appropriatedisclosures. The applicable requirements depend onthe relevance and materiality of climate-related risksto the investment strategies and funds managed.Required disclosures include baseline requirementsapplicable to all such fund managers, such asgovernance structure in relation to the management ofclimate-related risks and steps taken to incorporaterisk management into the investment managementprocess (including any key tools and metrics applied).Such disclosures must be made to investors viachannels—such as websites, newsletters, or reports—and reviewed at least annually (and updated in theinterim, where appropriate), and fund investors mustbe informed of any material changes as soon aspracticable.A large fund manager with HK$8 billion or more infund assets for any three months in the precedingreporting period may also be subject to enhanced riskmanagement and disclosure standards, including adescription of its engagement policy at the entity levelregarding the management of material climate-relatedrisks and disclosure of Scope 1 and Scope 2 GHGemissions associated with portfolio investments at thefund level, together with calculation methodology,underlying assumptions and limitations, and theESG and the Sustainable Economy—19 February 2026 12proportion of investments that are assessed orcovered.With respect to reporting requirements, fundmanagers are subject to SFC reporting requirementsas licensed intermediaries. However, there arecurrently no prescribed ESG-related SFC reportingrequirements.ARE THERE ANY CURRENT OR PROPOSEDREQUIREMENTS OUTSIDE OF DISCLOSUREAND REPORTING (E.G., PRODUCT-LEVELINVESTMENT REQUIREMENTS)?There are currently no prescribed ESG-relatedrequirements for non-SFC-authorised funds.Fund managers of Hong Kong ESG Funds arerequired to regularly monitor and evaluate theunderlying investments to ensure that the Hong KongESG Funds continue to meet their stated ESG focusand requirements. In addition, SFC-authorised fundsand their fund managers are required to comply withall applicable codes and guidelines in relation to theirauthorisation and licensing that are not specificallyrelated to ESG.There are general requirements for licensedintermediaries to know their client (including theirinvestment objectives); to exercise due care, skill, anddiligence in providing services to the client; and to actin the best interests of the client. If a client hasindicated ESG- or climate-related investmentpreferences in its investment mandates, theintermediary is expected to take those intoconsideration. However, there is no currentrequirement that the intermediary determine a client's“sustainability preferences.”On 25 November 2024, the SFC issued a Circular toIntermediaries, guidance to asset managers regardingdue diligence expectations for third-party ESG ratingsand data product providers (the Guidance),referencing the VCoC for ESG ratings and dataproviders published on 3 October 2024 by a workinggroup comprised of Hong Kong and internationalrepresentatives from the ESG ratings and dataproducts industry. The VCoC is modelled oninternational best practices recommended by theInternational Organization of Securities Commissionsand intended to be internationally interoperable andpart of a globally consistent regulatory framework. TheVCoC is intended to enhance transparency ofmethodologies for ESG ratings and data products andimprove standards generally across the market, whichshould assist users of these products, including fundsand fund managers, to better carry out their duediligence. According to the Guidance, asset managersshould conduct reasonable due diligence and ongoingassessments on third-party ESG service providersand for this purpose may take into account theprinciples and recommended actions of the VCoC.ESG ratings and data products providers who signedup to the VCoC will be expected to make availablepublicly a self-attestation document that explains theirapproach and actions taken to adhere to the principlesof the VCoC. Asset managers can use this informationto facilitate their due diligence and ongoingassessment of the ESG service providers and theirproducts.DO THE EXISTING OR PROPOSED RULESAPPLY EQUALLY TO OFFSHORE FUNDSBEING MARKETED IN THE REGION, OR DOTHEY APPLY SOLELY TO LOCALLYDOMICILED PRODUCTS?The requirements relating to SFC-authorised fundsapply irrespective of domicile. As long as a fund,including an offshore fund, has been authorised by theSFC for marketing to retail investors in Hong Kong, itmust comply with the applicable requirements.ESG and the Sustainable Economy—19 February 2026 13ARE ANY RULES IN PLACE FOR INVESTORS(VERSUS FUNDS AND FUND MANAGERS)?There are currently no prescribed ESG-related rulesfor investors. The SFC has issued a set of “Principlesof Responsible Ownership,” which provides principlesand guidance to assist investors in determining how tobest meet their ownership responsibilities. Theseprinciples are nonbinding and voluntary, but investorsare encouraged to adopt them and to disclose to theirstakeholders that they have done so in whole or inpart, as well as explain any deviations or alternativemeasures adopted.ARE THERE OTHER ACTIONS OR INITIATIVESTHAT COULD IMPACT FUNDS ANDMANAGERS?In May 2024, the HKMA published Phase 1 of theHong Kong Taxonomy for Sustainable Finance (theHong Kong Taxonomy). The Hong Kong Taxonomycurrently encompasses 12 economic activities underfour sectors: power generation, transportation,construction, and water and waste management. It isexpected to include more sectors and activities in thefuture and is designed to facilitate easy navigationamong other taxonomies, including the CommonGroup Taxonomy, China's Green Bond EndorsedProjects Catalogue, and the European Union'sTaxonomy for Sustainable Activities. On 8 September2025, the HKMA launched a public consultation on thePhase 2A Prototype of the Hong Kong Taxonomy(Phase 2A Prototype). Among other keyenhancements, two new sectors—themanufacturing and the information andcommunications technology sectors—and 13 neweconomic activities have been added. Although theHong Kong Taxonomy is not expected to have anyimmediate regulatory impact on fund managers inHong Kong as it is not required to be adopted, itprovides practical guidance to fund managers who arerequired to take account of climate-related risks intheir investment and risk management processesregardless of whether the managed fund is a HongKong ESG Fund. It also provides guidance to fundmanagers of Hong Kong ESG Funds when selectingunderlying investments that are commensurate withthe disclosed ESG focus of such funds. As discussedbelow, the Cross-Agency Steering Group is aiming toexpand the scope of the Hong Kong Taxonomy byincorporating transition elements and adding newsustainable activities. The Phase 2A Prototype can beconsidered an initiative to promote this goal.In June 2023, the ISSB published its two inauguralIFRS sustainability standards, IFRS S1 GeneralRequirements for Disclosure of Sustainability-relatedFinancial Information and IFRS S2 Climate-relatedDisclosures (collectively, the ISSB Standards), forreporting periods beginning on or after 1 January2024, subject to endorsement by local jurisdictionsand transitional relief. On 12 December 2024,following a public consultation, HKICPA published itsfirst two Hong Kong sustainability disclosurestandards, HKFRS S1 and S2, which fully align withthe ISSB Standards, with an effective date of 1 August2025 (the Hong Kong Standards).Unlike HKFRS accounting standards, the Hong KongStandards are not mandatory for Hong Kongincorporated companies or other entities in HongKong, unless there are other applicable legislative orregulatory requirements mandating compliance (e.g.,listing rules issued by HKEX).However, in December 2024, the Hong Konggovernment published the Roadmap on SustainabilityDisclosure in Hong Kong (the 2024 Roadmap), whichsets out Hong Kong's approach to require PAEs,which includes listed companies and large financialinstitutions, to adopt the Hong Kong Standards, withlarge PAEs (large-cap listed companies and largenonlisted financial institutions carrying a significantweight in Hong Kong) expected to do so no later than2028.ESG and the Sustainable Economy—19 February 2026 14The SFC's initial ESG focus in relation to fundmanagers has been on climate-related risks, asmetrics are generally more developed in this areacurrently, and the SFC believes that this will helpeffective implementation. However, the SFC has alsoacknowledged the importance of ESG factors moregenerally and stated that it will remain abreast ofinternational and market developments and consideran expansion of the regulatory coverage to otheraspects of ESG over the longer term. The 2024Roadmap further reinforces this approach.Under the 2024 Roadmap, Hong Kong will prioritisethe application of the Hong Kong Standards by largePAEs under a phased-in approach with reference tothe ISSB Inaugural Jurisdictional Guide issued by theISSB Foundation in May 2024.As an interim step, all HKEX Main Board listed issuersare required to comply with the new climate disclosurerequirements based on IFRS S2 on a “comply orexplain” basis starting from 1 January 2025 (exceptfor the mandatory disclosure requirement on Scope 1and Scope 2 GHG emissions that apply to all HKEXlisted issuers from 1 January 2025). Large-cap issuerswill be required to disclose against the new climatedisclosure requirements on a mandatory basis startingfrom 1 January 2026. HKEX will then conduct areview in 2027 on how the Hong Kong Standards canbe better applied to listed PAEs for the financial yearsbeginning on or after 1 January 2028 (with an aim forlarge-cap issuers to fully adopt the Hong KongStandards no later than 2028).Nonlisted PAEs, which are expected to include assetmanagers if they carry significant weight in HongKong, are expected to be required by relevantfinancial regulators to apply the Hong Kong Standardsno later than 2028, subject to stakeholders' commentsand feedback. Relevant authorities and regulators,including the SFC, which regulates funds and fundmanagers, are expected to conduct sector-specificengagements to determine the approach and timing ofadopting the Hong Kong Standards for differentfinancial sectors.Moreover, in February 2025, the MPFA gave adirective to MPF trustees to raise their disclosurestandards on ESG-focused constituent funds availableunder MPF pension schemes (the Directive). Inparticular, the MPF trustees should make thedisclosure in their MPF scheme brochures, as well asthe annual governance reports on the salientinvestment and risk-management strategies, and alsoprovide periodic (at least annually) assessment resultsof these funds. The Directive required existing fundsto implement new disclosure requirements by 30September 2025. As for new funds, MPF trusteesshould provide the MPFA with at least one of thefollowing to confirm incorporation of ESG factors asthe key investment focuses and ongoing monitoring ofattainment of ESG focuses: (a) self-confirmation ofcompliance; or (b) confirmation supported by anindependent third-party certification or fund label todemonstrate compliance.WHAT IS ON THE HORIZON?The Cross-Agency Steering Group, comprised ofvarious regulators and governmental bodies, wasestablished by the Hong Kong government toaccelerate the growth of green and sustainablefinance and support the government's climatestrategies. The Cross-Agency Steering Group hasidentified the following as the priorities in 2025:▪ Supporting the implementation of the ISSBStandards in Hong Kong, including working withstakeholders to provide technical assistance onsustainability reporting, developing a sustainabilityassurance framework, and delivering capacitybuilding programs in collaboration with theindustry.▪ Reinforcing Hong Kong's role as a leadingsustainable and transition finance hub byengaging the industry to expand the Hong KongESG and the Sustainable Economy—19 February 2026 15Taxonomy to incorporate transition elements andadd new sustainable activities; developingoperational guidance for practising transitionfinance in a sectoral approach; setting up atransition finance knowledge hub on its website;and developing Hong Kong into an Asia-Pacificregion carbon trading hub.▪ Publishing an official Hong Kong Green FintechMap, which was accomplished in June 2025.Similar to the Green Fintech Map that the CrossAgency Steering Group published last year thatset out a comprehensive directory of green fintechfirms operating in Hong Kong, the Hong KongGreen Fintech Map facilitates large-scalemobilisation of sustainable capital and enablesinformation flow with greater transparency andaccessibility.ESG and the Sustainable Economy—19 February 2026 16JAPANBy Yuki SakoWHAT RULES, IF ANY, ARE CURRENTLY INPLACE (I.E., HAVE BEEN ADOPTED) FORFUNDS AND ASSET MANAGERS?Disclosure and Organizational ResourcesRequirements for Publicly Offered ESG InvestmentTrustsThe Comprehensive Guidelines for Supervision ofFinancial Instruments Business Operators(Supervisory Guidelines) issued by the FSA requireasset managers to make certain disclosures andimplement certain organizational or operational anddue diligence measures (ESG Guidelines) regardingpublicly offered ESG-focused investment trusts. TheESG Guidelines, which became effective 31 March2023, include:▪ Definition of ESG Funds: ESG Guidelines focuson “ESG Funds,” which are defined as publiclyoffered investment trusts that (a) consider ESG as“a key factor” in the selection of investmentassets, and (b) disclose that ESG is such a keyfactor in their respective prospectuses (JapanESG Funds). Asset managers must determinewhether their funds are “ESG Funds” (referred toas Japan ESG Funds in this publication).▪ Required Disclosure Regarding InvestmentStrategies: Japan ESG Fund managers arerequired to provide ESG-related disclosures in thefund's prospectuses, including (a) detailedinformation about key ESG factors considered inselecting investment assets; (b) a description ofhow key ESG factors are considered in theinvestment process; (c) the risks and limitations ofsuch consideration; (d) for Japan ESG Funds thatseek to achieve a certain impact, detailedinformation about the impact and how it ismeasured; (e) any fund-specific policy or themanager's companywide stewardship policy; and(f) if additional disclosure is provided on awebsite, references to such website.▪ Required Disclosure Regarding PortfolioConstruction: Japan ESG Fund managers arerequired to disclose in the fund's prospectus, withrespect to any Japan ESG Fund, any designatedtarget or standard ratios or indicators, whether onthe basis of an amount of investments selected bykey ESG factors or on the entire portfolio basis. Ifno target or standard ratios are designated, thereshould be an explanation as to why that is thecase.▪ Required Disclosure Regarding Reference Index:If a Japan ESG Fund seeks to track a specificESG index, the Japan ESG Fund manager isrequired to disclose how ESG factors areconsidered by such ESG index and the manager'sreasons for selecting such ESG index.▪ Required Periodic Disclosure: Japan ESG Fundmanagers are required to provide, as applicable,the following periodic disclosures in the fund'sinvestment reports or periodic disclosuredocuments: (a) if target or standard ratios ofinvestments selected by key ESG factors aredesignated, actual investment ratios calculatedusing the amount of investments (market value)selected by such ESG factors against the total netassets; (b) if target or standard ESG valuationindicators used for selecting investments aredesignated for entire ESG portfolios, the status ofachievement; (c) any ESG impact achieved; (d)actions taken in accordance with any relatedstewardship policy; and (e) if further informationregarding these items is provided on a website orelsewhere, references to such website or places.▪ Required Due Diligence for InvestmentManagement Outsourcing: When management ofa Japan ESG Fund is outsourced to anotherESG and the Sustainable Economy—19 February 2026 17manager, appropriate due diligence must beconducted with regard to such other manager,including its investment management practicesand whether such manager provides all types ofrequired disclosure and reporting listed previouslyor an explanation as to why it does not providesuch disclosure or reporting.▪ Organizational Resources: Japan ESG Fundmanagers must have adequate resources to both(a) provide investment management services inaccordance with the funds' stated investmentstrategies, and (b) monitor such services,including by maintaining ESG-related data orinformation technology infrastructure or securingappropriate personnel. If management of a JapanESG Fund is outsourced to another manager (i.e.,a subadviser or submanager), the primary assetmanager must have the internal resourcesnecessary to conduct due diligence and ensurethat the submanager's disclosures and reportingare accurate.▪ Due Diligence for ESG Rating and DataProviders: Japan ESG Fund managers mustconduct appropriate due diligence when usingESG ratings or data in their investment process.The ESG Guidelines also apply to non-ESG publiclyoffered investment trusts (Non-Japan ESG Funds).Specifically, Non-Japan ESG Funds may not useESG-related terms (e.g., ESG, sustainabledevelopment goals, green, decarbonization, impact,sustainable) in their names, and when ESG is onlyone factor to be considered along with other factorsand has no greater significance, such Non-JapanESG Funds' prospectuses and marketing materialsshould not include statements that would misleadcustomers to think that ESG is a key factor inselecting investment assets.Code of Conduct for ESG Rating and DataProvidersIn December 2022, the FSA issued the final “Code ofConduct for ESG Evaluation and Data Providers”(Code of Conduct). The Code of Conduct consists ofsix principles and guidelines for ESG rating and dataproviders to (a) ensure quality of ESG ratings anddata; (b) provide more transparency and fairness; (c)address conflicts of interest issues; (d) ensure theretention of appropriate personnel, including providingappropriate training; (e) mitigate conflicts of interestand ensure independence, objectiveness, andneutrality; (f) provide for proper handling of nonpublicinformation; and (g) facilitate better communicationswith operating companies that receive ESG ratingsand other entities. Although the Code of Conduct isnot a formal regulation, the FSA calls for ESG ratingand data providers to formally endorse the Code ofConduct. Accordingly, such entities are subjected to a“comply or explain” regime; providers must complywith or provide an explanation as to why they aredeparting from, the Code of Conduct.More directly relevant to asset managers, the Code ofConduct includes “recommendations to investors,”which are attached to the Code of Conduct asreferences but are not formally part of the Code ofConduct. For this purpose, the term “investors”includes entities and persons that invest proprietary orclient funds, such as asset managers. Therecommendations call for investors to:▪ Carefully examine and understand the purpose,methodologies, and limitations of ESG evaluationand data they utilize for their investmentdecisions.▪ To the extent there are issues in evaluationresults, engage in dialogue with the applicableESG evaluation and data providers or companies.▪ Publicly clarify the basic approach of how theyutilize ESG evaluation and data in theirinvestment decisions.ESG and the Sustainable Economy—19 February 2026 18While the FSA has stressed that therecommendations are voluntary and do not imposeformal obligations, it also affirmed that each assetmanager should consider implementing theseprinciples as appropriate in consideration of the natureof its business, confidentiality, and fiduciaryobligations. Asset managers using ESG ratings anddata should be mindful that the FSA views thesemeasures as an important part of proper ESG ratingand data usage.WHAT LABELS OR CATEGORIES, IF ANY, ARECURRENTLY REQUIRED OR HAVE BEENPROPOSED FOR FUNDS AND ASSETMANAGERS?No formal labels or categories have been establishedor proposed.WHAT DISCLOSURE AND REPORTINGREQUIREMENTS ARE CURRENTLY REQUIREDOR HAVE BEEN PROPOSED FOR FUNDS ANDASSET MANAGERS?Other than the disclosure and reporting requirementsunder the ESG Guidelines discussed above, there areno ESG-specific disclosure or reporting requirementsapplicable to funds or asset managers. Note,however, that Japan requires publicly listedcompanies to provide certain ESG-related disclosuresunder the corporate disclosure regime.ARE THERE ANY CURRENT OR PROPOSEDREQUIREMENTS OUTSIDE OF DISCLOSUREAND REPORTING (E.G., PRODUCT-LEVELINVESTMENT REQUIREMENTS)?No. However, the FSA convenes several groups ofacademic and industry experts to discuss variousESG-related issues in the financial sector. Uponpublic consultation on 29 March 2024, the FSAadopted the “Basic Guidelines on Impact Investment(Impact Finance),” setting forth certain concepts andfactors to be considered in pursuing “impactinvestments” (Impact Investment Guidelines). TheImpact Investment Guidelines highlight four specificelements of impact investments: (a) intention; (b)contribution; (c) identification, measurement, andmanagement; and (d) accelerating markettransformations. They also provide guidanceregarding these concepts. For example, with respectto intention, they describe how intended social andenvironmental impacts can be or should be clarified.The stated purposes of the Investment Guidelinesinclude setting forth shared understandings andexpectations for concepts relating to impactinvestments among asset managers, investors, andother stakeholders, and encouraging furtherdiscussions among them. While the ImpactInvestment Guidelines do not create any legal orregulatory obligations per se, asset managers maywant to consider these elements when providingservices to Japanese investors in the area of impactinvestments.DO THE EXISTING OR PROPOSED RULESAPPLY EQUALLY TO OFFSHORE FUNDSBEING MARKETED IN THE REGION, OR DOTHEY APPLY SOLELY TO LOCALLYDOMICILED PRODUCTS?The FSA has stated that the ESG Guidelinesgenerally do not apply to foreign domiciled investmentfunds that are managed outside of Japan. While theSupervisory Guidelines primarily apply to assetmanagers registered in Japan or certain managersthat are relying on exemptions that are subject to theFSA's supervision, non-Japanese managers whoseasset management services to Japan ESG Fundswere delegated to them by Japanese managers maybe indirectly impacted as a result of that outsourcing.Accordingly, such non-Japanese submanagers mayultimately be required to satisfy some of theaforementioned disclosure and reportingrequirements.ESG and the Sustainable Economy—19 February 2026 19ARE ANY RULES IN PLACE FOR INVESTORS(VERSUS FUNDS AND FUND MANAGERS)?As discussed previously, the Code of Conduct forESG rating and data providers includesrecommendations (i.e., not formal rules) for investors,including fund managers. As noted, these includerecommendations that certain disclosures be providedand actions be taken by investors with respect to theiruse of ESG ratings and data.In August 2024, the Japanese government adopted“Asset Owner Principles,” which set forth fiveprinciples that should be considered by asset ownersin fulfilling their fiduciary responsibilities. Theseprinciples include consideration relating tostewardship activities, including engaging insustainable investments or requiring their managers toconsider sustainability in investing in their assets.These principles are not regulations per se.Nevertheless, a number of Japanese institutionalinvestors—including corporate and public pensions,insurance companies, and universities—announcedthat they adopted these principles.ARE THERE OTHER ACTIONS OR INITIATIVESTHAT COULD IMPACT FUNDS ANDMANAGERS?Since December 2020, the Expert Panel onSustainable Finance established by the FSA hasdiscussed various issues, including sustainableinvestments and disclosure. Members of the panelinclude asset management, broker and bankingindustry associations, and other business associationsand stakeholders. Most recently, the panel issued itsfourth report summarizing the current state of play invarious aspects, including disclosure, accessibility tosustainable investment opportunities, and variousinitiatives relating to sustainable finance. While themost recent report did not include specific noteworthyregulatory proposals, we will continue to monitorpolicy priorities discussed at the panel.WHAT IS ON THE HORIZON?We expect that, in light of the current global trends,the FSA may not be as active as it had been inreviewing various ESG-related policy and regulatoryissues, as well as setting forth guidelines for ESGrelated products. Rather, one of the recent policyfocuses appears to be on the governance factor topromote dialogue and engagement between investorsand companies.On 26 June 2025, following several meetings at anexpert panel called by the FSA, amendments to theStewardship Code were finalized. The StewardshipCode was first adopted in 2014 to promotestewardship responsibilities of institutional assetowners to promote sustainable growth throughconstructive engagement in consideration ofsustainability (more specifically, medium- to long-termsustainability including ESG factors). The finalizedStewardship Code requires an asset owner whohas adopted the Stewardship Code to, if requested bya company, both (a) disclose its shareholdings to therequesting company, and (b) publicly disclose itspolicy on how they respond to such requests by acompany. The purpose of this requirement is topromote constructive dialogue between the assetowner and companies.Separately, as a related matter, the Japanesegovernment is currently considering updating theCompanies Act to give companies an inquiry rightthrough which a company may find an ultimatebeneficiary of its shares who has the right to decideon shareholder voting rights. Such inquiry right andrelated shareholder transparency is considered as ameans to promoting dialogue and engagementbetween companies and asset owners.ESG and the Sustainable Economy—19 February 2026 20SINGAPOREBy Edward M. Bennett and Anu L. Jose, K&L GatesStraits Law LLCThe Singapore section of this publication is issued byK&L Gates Straits Law LLC, a Singapore law firm withfull Singapore law and representation capacity, and towhom any Singapore law queries should beaddressed. K&L Gates Straits Law is the Singaporeoffice of K&L Gates LLP.WHAT RULES, IF ANY, ARE CURRENTLY INPLACE (I.E., HAVE BEEN ADOPTED) FORFUNDS AND ASSET MANAGERS?Given the growing international investor interest inESG-related investment products, in late July 2022,MAS released MAS Circular No. CFC 02/2022(Circular), setting out ESG disclosure and reportingguidelines to mitigate the risk of greenwashing withrespect to a retail ESG fund (called a “scheme” in theCircular).MAS also used the Circular, which took effect 1January 2023, to explain how the requirements underthe existing CIS Code and Securities and Futures(Offers of Investment) (Collective InvestmentSchemes) Regulations 2005 (SF(CIS)R) should applyto retail ESG funds.The Circular pertains to retail “ESG funds” and therelated CMS licensees and approved trustees underSection 289 of the SFA who sponsor and operatesuch ESG funds.The Circular defines an “ESG fund” as an authorisedor recognised scheme (i.e., fund) that: (a) uses orincludes ESG factors as its key investment focus andstrategy (i.e., ESG factors significantly influence thescheme's selection of investment assets), and (b)represents itself as an ESG-focused scheme. ESGfunds may incorporate sustainable investing strategieswith significant ESG influences, such as impactinvesting and ESG inclusionary investing. This couldinclude broad strategies, such as the application ofbest-in-class positive screening and ESG tilts, andthematic strategies, such as strategies with a specificfocus on ESG outcomes, such as low-carbontransition. Notably, a scheme would not be regardedas having an ESG investment focus if it only usesnegative screening or merely incorporates orintegrates ESG considerations into its investmentprocess to seek financial returns.In assessing the compliance of a fund with theCircular, MAS will consider its compliance with therelevant ESG rules in its home jurisdiction, if any. Forexample, a UCITS scheme that is an ESG fund wouldbe considered to have complied with the Circular'sdisclosure requirements if it complies with Article 8 or9 of the European Union's SFDR. However,compliance with the naming requirements underSection B of the Circular (as discussed in more detailbelow) is still required for any such UCITS fund.On 4 December 2024, MAS published the InformationPaper, which sets out good disclosure practices thatESG funds may adopt in their adherence to the ESGdisclosure guidelines set out in the Circular.Notably, the Information Paper calls for ESG fundmanagers to clearly define, within the context of anESG fund, vague or subjective terms such as“favourable/improving ESG characteristics,”“sustainable leaders,” or “strong sustainability profile.”This is because such terms, on their own, do not giveinvestors adequate insight into the types of ESGinvestments or strategies that an ESG fund may seekto employ. The overall intention is for greateralignment of expectations and to empower investorsto make informed investment decisions.The Information Paper also recommends that ESGfund managers provide clear descriptions of ESGmetrics used by their ESG funds and the extent towhich they are to be used. The aim is to improveESG and the Sustainable Economy—19 February 2026 21manager accountability and minimise potentialgreenwashing by providing clear yardsticks by whichinvestors can assess whether an ESG fund has metits claims. Key areas that MAS considers ESG fundmanagers should disclose as a matter of goodpractice include: (a) sources of ESG criteria ormetrics; (b) calculation methodologies and descriptionof underlying data used; (c) the minimum ESG ratingor score that investments must meet; and (d) thebasis for sustainability targets set (if any).WHAT LABELS OR CATEGORIES, IF ANY, ARECURRENTLY REQUIRED OR HAVE BEENPROPOSED FOR FUNDS AND ASSETMANAGERS?Chapter 4.1 of the CIS Code provides that schemenames must be “appropriate, and not undesirable ormisleading.” Therefore, should an ESG fund wish touse an ESG-related name, an ESG focus should bereflected in its investment portfolio or strategy in asubstantial manner.To assess whether a scheme is ESG focused, MASwill consider factors such as whether the scheme'scapital is primarily invested in an ESG strategy (i.e.,generally, at least two-thirds of the scheme's net assetvalue must be invested in accordance with an ESGrelated investment strategy).MAS also expects fund managers to explain in eachscheme's offering documents how its investments aresubstantially ESG focused on cases where it is neitherpossible nor practicable to determine, at the individualasset level, the proportion of a scheme's net assetvalue that is invested in accordance with ESGinvesting strategies.On 3 December 2023, MAS launched the SingaporeAsia Taxonomy for Sustainable Finance (theTaxonomy). The Taxonomy sets out detailedthresholds and criteria for defining green andtransition activities that contribute to climate changemitigation across eight focus sectors: energy,industrial, carbon capture and sequestration,agriculture and forestry, construction and real estate,waste and circular economy, information andcommunications technology, and transportation.This initiative is designed to mitigate the risk ofgreenwashing and ensure that financed activities areon a credible path to net-zero emissions.Transition activities are defined through twoapproaches:▪ A “traffic light” system that defines green,transition, and ineligible activities across the eightfocus sectors. In this context, “transition” refers toactivities that do not meet the green thresholdsnow but are on a pathway to net-zero—orcontributing to net-zero outcomes.▪ A “measures-based approach” that seeks toencourage capital investments intodecarbonisation measures or processes that willhelp reduce the emissions intensity of activitiesand enable the activities to meet the green criteriaover time.MAS plans to collaborate with industry stakeholdersand government agencies to explore the Taxonomy'suse in developing taxonomy-aligned financialinstruments, accelerating the flow of capital into greenand transition activities, and encouraging companiesto disclose transition plans and use the Taxonomy tosupport these disclosures.WHAT DISCLOSURE AND REPORTINGREQUIREMENTS ARE CURRENTLY REQUIREDOR HAVE BEEN PROPOSED FOR FUNDS ANDASSET MANAGERS?Prospectus Disclosure Requirements andGuidelinesThe third schedule of the SF(CIS)R sets out therequirements for information to be disclosed in ascheme's prospectus. In addition, the Circular requiresESG and the Sustainable Economy—19 February 2026 22that the prospectus of an ESG fund lodged (i.e., filed)with MAS clearly defines ESG-related terms anddiscloses information relating to the fund's investmentfocus, investment strategy, reference benchmark, andthe risks associated with investing in the scheme. TheCircular sets out some practical examples of thedisclosure requirements:▪ Investment Focus: The ESG focus of the schemeand the relevant ESG criteria, methodologies, ormetrics used to measure whether the ESG focusis achieved.▪ Investment Strategy: An explanation of how thesustainable investing strategy is used to achievethe scheme's ESG focus, the binding elements ofthe strategy in the investment process, and howthe strategy is applied in the investment processon a continuous basis; the relevant ESG criteria,metrics, or principles considered in the investmentselection process; and the minimum allocationinto assets used to achieve the scheme's ESGfocus.▪ Reference Benchmark: Where the schemereferences a benchmark or index to measurewhether an ESG focus is achieved, anexplanation of how the benchmark or index isconsistent with or relevant to its investment focus;and where the scheme references a benchmarkor index for financial performance measurementonly, a statement to this effect.▪ Risk Factors: Risks associated with the scheme'sESG focus and investment strategy, such asconcentration in investments with a certain ESGfocus and limitations of methodology and data.Annual Report Disclosure Requirements andGuidelinesAnnual reports of ESG funds must include thefollowing information:▪ Details of how, and the extent to which, thescheme's ESG focus was fulfilled during thefinancial period, including a comparison with theprevious period (if any).▪ The actual proportion of the scheme's investmentsthat meet its ESG focus (if applicable).▪ Actions taken to achieve the scheme's ESG focus(e.g., through engaging with stakeholders).Additional Information DisclosuresFund managers should disclose, by appropriatemeans, additional information regarding an ESG fund,such as:▪ How the ESG focus is measured and monitored,as well as the related internal or external controlmechanisms that are in place to monitorcompliance with the scheme's ESG focus on acontinuous basis (including methodologies usedto measure the attainment of the scheme's ESGfocus, if any).▪ Sources and usage of ESG data or anyassumptions made where data is lacking.▪ Due diligence carried out in respect of the ESGrelated features of the scheme's investments.▪ Any stakeholder engagement policies (includingproxy voting) that can help influence corporatebehaviour of investee companies and contributeto the attainment of the scheme's ESG focus.Climate ReportingFrom FY 2025, certain categories of listed companiesin Singapore will be required to make ISSB-alignedclimate-related disclosures of GHG emissions if any ofthe three following categories of GHG emissions areapplicable:▪ Scope 1 GHG emissions: Direct emissions fromowned or controlled resources of the entity.▪ Scope 2 GHG emissions: Indirect emissions fromthe generation of purchased energy by the entity.ESG and the Sustainable Economy—19 February 2026 23▪ Scope 3 GHG emissions: Any indirect emissionsthat occur in the value chain of the entity,including upstream and downstream emissions.There is a three-tiered structure to the climatereporting obligations based on market capitalizationfor SGX listed companies:▪ STI constituents (i.e., the top 30 companies listedon SGX based on market capitalization).▪ Non-STI constituent listed companies with amarket capitalization of S$1 billion and above.▪ Non-STI constituent listed companies with amarket capitalization of less than S$1 billion.All entities listed on the SGX will have to report onScope 1 and Scope 2 GHG emissions from FY 2025.From FY 2026, only STI constituents will be requiredto report on the much broader Scope 3 GHGemissions where applicable. For non-STI constituentlisted companies, Scope 3 GHG emissions reportingwill be voluntary until further notice. Other ISSB-basedclimate-related disclosures cover details on howcompanies address climate risks and opportunitiesthrough their governance, strategic planning, and riskmanagement processes, as well as the key metricsand targets used to track progress. These other ISSBbased climate-related disclosures—beyond Scope 1,2, and 3 GHG emissions—will remain mandatory forSTI constituent listed companies starting from FY2025. For non-STI listed companies with a marketcapitalization of S$1 billion or more, the requirementwill apply from FY 2028, while those with a marketcapitalization below S$1 billion will need to complyfrom FY 2030. External limited assurance for Scope 1and Scope 2 GHG emissions is deferred to FY 2029for all listed companies.From FY 2030, large nonlisted companies with atleast S$1 billion in revenue and total assets of at leastS$500 million will also be required to report on Scope1 and Scope 2 GHG emissions. The reportingrequirements for these companies in relation to Scope3 GHG emissions will be on a voluntary basis untilfurther notice. In addition, the requirement to obtainexternal limited assurance for Scope 1 and Scope 2GHG emissions has been deferred from FY 2029 toFY 2032 for these companies.The reporting requirements will apply to listedbusiness trusts, investment funds (excluding ETFs),and real estate investment trusts. It remains to beseen if this climate-related disclosure requirement willextend to private investment funds in the future.In view of the increasing demand for companies topublish climate-related disclosures, Singapore'sEconomic Development Board and EnterpriseSG willlaunch a Sustainability Reporting Grant. This grant willprovide funding support for large companies withannual revenue of at least S$100 million to cover aportion of their costs in producing their firstsustainability report in Singapore. The grant defraysup to 30% of qualifying costs, capped at the lower ofS$150,000 per company or 30% of the qualifyingcosts in the preparation of their first sustainabilityreport.While sustainability reporting is currently notmandatory for SMEs, it is fast becoming a criticalcapability given the increasing requirement by largecorporations to assess their suppliers' sustainabilityperformance. To enable SMEs to report onsustainability, EnterpriseSG will partner withappointed sustainability service providers to launch aprogram to help SMEs develop their first sustainabilityreports. The program will be available for three years.EnterpriseSG will defray 70% of eligible costs forSMEs participating in the first year of the program and50% of costs for the following two years.ESG and the Sustainable Economy—19 February 2026 24ARE THERE ANY CURRENT OR PROPOSEDREQUIREMENTS OUTSIDE OF DISCLOSUREAND REPORTING (E.G., PRODUCT-LEVELINVESTMENT REQUIREMENTS)?No, requirements are currently limited to theenhanced disclosure and reporting obligationsdescribed above.DO THE EXISTING OR PROPOSED RULESAPPLY EQUALLY TO OFFSHORE FUNDSBEING MARKETED IN THE REGION, OR DOTHEY APPLY SOLELY TO LOCALLYDOMICILED PRODUCTS?As noted above, MAS will consider an offshore fund'scompliance with its local regulations, to the extentadequately demonstrated by the fund sponsor. MASwill also consider the compliance of a foreign“recognised” scheme with the relevant ESG rules in itshome jurisdiction when assessing compliance with theSingapore requirements.ARE ANY RULES IN PLACE FOR INVESTORS(VERSUS FUNDS AND FUND MANAGERS)?There are currently no prescribed ESG-related rulesor voluntary codes for investors.ARE THERE OTHER ACTIONS OR INITIATIVESTHAT COULD IMPACT FUNDS ANDMANAGERS?With the release of the final report of the InternationalOrganization of Securities Commissions on “ESGRatings and Data Products Providers” identifying keyareas of concern and providing recommendations forgood practices around governance, management ofconflicts of interest, and transparency for ESG ratingand data product providers, MAS, like otherregulators, is developing an approach to regulate thisnascent and rapidly changing industry.Following public consultation from June to August2023, in December 2023, MAS published a CoC andan accompanying compliance checklist for providers(Checklist). The CoC covers best practices ongovernance, management of conflicts of interest, andtransparency of methodologies and data sources,including disclosure on how forward-looking elementsare taken into account in data products. Thisdisclosure is intended to allow users to better considertransition risks and opportunities when determiningcapital allocation. MAS is encouraging providers todisclose their adoption of the CoC and publish theircompleted Checklist within 12 months from publicationof the CoC. In addition, providers must apply the CoCon a “comply or explain” basis. MAS has alsoencouraged market participants that use ESG ratingsand data products to engage with providers that adoptthe CoC.For the long-term regulation of ESG rating providers,MAS proposed to apply the CMS licensing regimeunder the SFA to ESG rating providers. The proposedregulatory regime for the provision of ESG ratingservices will likely emulate the regulatory regime forthe provision of credit rating services. As CMSlicensees, the ESG rating providers will have tocomply with the corresponding regulations, guidelines,and notices under the SFA, including a code ofconduct that could be modelled on the CoC. MAS willhave supervisory and enforcement powers over ESGrating service providers.WHAT IS ON THE HORIZON?The Singapore Green Plan 2030 (Green Plan) wasunveiled in February 2021 to advance Singapore'ssustainable development agenda and chartsSingapore's green targets over the next decade. TheGreen Plan includes targets for Singapore to becomea leading centre for green finance in Asia and globally.Various requirements were identified for green financeto work effectively, such as implementing a consistentset of global disclosure and reporting standards;ESG and the Sustainable Economy—19 February 2026 25improving the quality, availability, and comparability ofdata; and developing taxonomies for green andtransition activities.MAS also launched Project Greenprint in December2020, which aims to harness technology to supportgreen finance in conjunction with the financialindustry—establishing data platforms to mobilisecapital for green projects, facilitating the acquisitionand certification of climate-relevant data, andmonitoring the financial industry's commitments toemissions reductions. In November 2023, MASlaunched Gprnt (pronounced “Greenprint”). Gprnt isthe culmination of Project Greenprint and offers anenhanced digital reporting solution for businesses toseamlessly report their ESG information by enablingthem to automatically convert their economic data intosustainability-related information. It seeks to achievethis by integrating with a range of digital systems usedin day-to-day business operations, including systemsfor utilities consumption; bookkeeping and payrollsolutions; building and waste management; paymentsgateways; and networks for artificial intelligence ofthings, sensors, and devices. Through theseintegrations, it is intended that Gprnt will enablecompanies to easily share their operational data withend users such as financial institutions and regulators,which will then be used to compute key sustainabilitymetrics. Gprnt will initially focus on addressing thebaseline reporting needs of SMEs, and willprogressively scale its capabilities and network of datasources in the future, to serve the more advancedneeds of larger multinational corporations, financialinstitutions, supply chain players, and nationalauthorities.MAS is intending to introduce a set of Guidelines onTransition Planning to provide guidance for assetmanagers to facilitate their transition planningprocesses as they build climate resilience and enablerobust climate mitigation and adaptation measures.In the proposed guidelines, asset managers are urgedto consider, among other things:▪ Adopting a multiyear view for the continuedsustainability of their portfolios in a “forwardlooking manner.” For instance, asset managersshould set decarbonisation targets that aresupportive of the global transition to a carbonminimised economy as part of their strategicdecision-making process.▪ Engaging with issuers regarding the need to adoptmitigation strategies where climate risks appear tobe of material concern. In this regard, assetmanagers are encouraged to implementstructured processes to identify and prioritiseissuers for engagement, especially those whichare more vulnerable to transition.▪ Having a clear and actionable strategy andapproach to guide the implementation of theirtransition plans.▪ Proactively communicating their transitionplanning process by publishing sustainabilityreports.▪ Establishing mechanism(s) through which theasset managers' existing approaches to respondto climate-related risks are regularly refined due tothe evolving nature of climate risk managementpractices.AUSTRALIAESG and the Sustainable Economy—19 February 2026 27AUSTRALIABy Jim Bulling, Michelle Huo, and Lisa LautierWHAT RULES, IF ANY, ARE CURRENTLY INPLACE (I.E., HAVE BEEN ADOPTED) FORFUNDS AND ASSET MANAGERS?Funds and asset managers are prohibited frommaking statements that are false or misleading, andfrom engaging in dishonest, misleading, or deceptiveconduct when offering or promoting sustainabilityrelated products. These prohibitions are set out underthe Corporations Act 2001 (Cth) (Corporations Act)and the ASIC Act.In addition, funds and asset managers must complywith certain disclosure obligations and guidelineswhen preparing a product disclosure statement forsustainability-related products that are offered to retailinvestors. These obligations are set out under theCorporations Act, which requires disclosure of theextent to which labour standards or environmental,social, or ethical considerations are taken into accountin selecting, retaining, or realising an investment.To assist funds and asset managers in complying withtheir obligations, ASIC issued Information Sheet 271.The information sheet defines “greenwashing” andsets out nine questions to consider when offering orpromoting sustainability-related products. There is anexpectation that funds and asset managers willconsider this information sheet when offering orpromoting sustainability-related products. In addition,ASIC Regulatory Guide 168 provides guidelines thatmust be complied with when Product DisclosureStatements for investment products make any claimthat labour standards or environmental, social, orethical considerations are taken into account ininvestment decisions. ASIC continues toincrease enforcement action in relation to theseobligations.On 1 January 2025, obligations began to roll out inrelation to mandatory climate-related financialdisclosures. The reporting requirements will apply tocertain large Australian businesses and financialinstitutions. It will require certain funds and assetmanagers to prepare a “sustainability report” inaddition to annual financial statements.WHAT LABELS OR CATEGORIES, IF ANY, ARECURRENTLY REQUIRED OR HAVE BEENPROPOSED FOR FUNDS AND ASSETMANAGERS?On 18 July 2025, Treasury released a consultationpaper on the design of Australia's SustainableInvestment Product Label regime. Treasury's objectivefor creating this regime is to increase investorconfidence in sustainability claims made by productissuers and to enable investors to make comparisonsbetween different products that have sustainabilityclaims.Treasury is consulting on three areas of designoptions for the regime. The first area is consideringhow to define investment approaches as"sustainable." This involves either explicitly definingsustainable investment approaches in legislation byusing standardised terminology or leaving the range ofpermitted investment approaches undefined.The second area is determining the circumstancesunder which a product issuer would be required to usea product label. The two possible options involveeither mandating labelling upon all financial productsor limiting the requirement to products that are namedor marketed with terms such as "sustainable" or"ethical."The third area under consideration is what level ofevidence is required to substantiate the usage of aproduct label. This could involve adopting aprescriptive approach that sets out specific types ofeligible assets, activities, or thresholds. In thealternative, a principle-based approach could beESG and the Sustainable Economy—19 February 2026 28adopted and supported by a requirement that claimsare certified by reputable third parties.Consultation on the product labelling regime closed on28 August 2025, with commencement anticipated in2027.In the meantime, industry guidance has beenprepared by the FSC, a local industry body. Thisguidance is set out in:▪ FSC Guidance Note No. 44 Climate RiskDisclosure in Investment Management (GuidanceNote 44) dated 3 August 2022.▪ FSC Information Sheet: Labelling ResponsibleInvestment Products dated 24 February 2024.FSC Guidance Note 44 addresses the use of productlabels such as “climate friendly,” “net-zero,” “impact,”and “best of sector,” and it offers asset managersrecommendations as to how they can approachdisclosure to ensure it aligns with such labels.An FSC Information Sheet released in 2024 outlinesoverarching principles in relation to the use ofresponsible or suitability-related terms in investmentproduct labelling. It also provides guidance oncommonly used labels, such as “ESG,” “Responsible,”“Sustainable,” “Sustainable Development Goals,”“Earth/Nature,” “Impact,” “Ethical,” “Stewardship,”“Active Ownership,” “Low carbon,” and “Net zero,” andlabels with religious meanings. The information sheetsets out an expectation of what that label representsand provides good practice examples of funds thatuse those labels.FSC guidance is, strictly speaking, only relevant forFSC members, but it is influential in establishingindustry standards and expectations.In addition to industry guidance, funds and assetmanagers should continue to be aware of ASIC'sexpectations. In August 2024, ASIC released ASICReport 791 on its regulatory interventions between 1April 2023 and 30 June 2024. In this report, there areseveral interventions identified from ASIC'ssurveillance activities relating to instances whereunderlying investments were inconsistent withdisclosed ESG investment screens and policies.Failure to act in accordance with ASIC's expectationshas attracted enforcement actions, such as correctivedisclosure outcomes and infringement notices.On 31 March 2025, ASIC finalised RG 280, whichdetails labelling requirements related to sustainabilityreporting. This includes that the terms “sustainabilityreports,” “climate statements,” “voluntary sustainabilitystatements,” and “voluntary climate statements” haveprecise meanings under the sustainability reportingregime. As such, these terms must be appropriatelydistinguished from other reports that may have beenhistorically labelled as “sustainability reports.”Additionally, RG 280 provides that fund and assetmanagers should exercise caution in relation to theselective use or reproduction of information containedwithin sustainability reports. ASIC has warned thatreporting entities that selectively reproduce or useinformation from a sustainability report:▪ Increase the risk of compromising the objective ofthe sustainability reporting regime.▪ Increase the risk that these disclosures may bemisleading.Examples of where selective reproduction could bemisleading include where:▪ A climate-related target is used in the headline ofan investor presentation without referencing theinputs, assumptions, and contingencies as aredisclosed in the sustainability report.▪ Information from a sustainability report issummarised in corporate documents in a mannerthat distorts the balance, tenor, or prominence ofinformation disclosed in the sustainability report.ESG and the Sustainable Economy—19 February 2026 29WHAT DISCLOSURE AND REPORTINGREQUIREMENTS ARE CURRENTLY REQUIREDOR HAVE BEEN PROPOSED FOR FUNDS ANDASSET MANAGERS?Australia's disclosure requirements for funds andasset managers are set out in legislation, ASICregulatory guidance, and industry guidance.Australia's reporting requirements with respect toclimate-related financial disclosures, on the otherhand, are being progressively phased in over the nextthree to four years, having commenced as of 1January 2025.Under the Corporations Act, entities will be required toreport climate-related information under a“sustainability report” to be lodged with ASIC eachfinancial year. The proposed regime builds on theexisting financial reporting framework for entities thatlodge financial reports under the Corporations Act.Climate-related information that is reported will needto comply with Australian Sustainability ReportingStandards issued by the AASB, which were finalizedon 20 September 2024. The standards comprise:▪ AASB S1: General requirements for Disclosure ofSustainability-related Financial information; and▪ AASB S2: Climate-related Disclosures.AASB S1 is a voluntary standard while AASB S2 is amandatory standard. These standards largely alignwith the ISSB standards with some modifications.Under the legislation, reporting obligations will bephased in over the next three to four years. Funds andasset managers will fall within one of three groups ifthey meet two of the three asset, revenue, andemployee size thresholds:▪ Group 1: 1 January 2025: Entities that haveconsolidated revenue of at least AU$500 million,consolidated assets of AU$1 billion, and 500 ormore employees.▪ Group 2: 1 July 2026: Entities that have aconsolidated revenue of at least AU$200 million,consolidated assets of AU$500 million, and 250 ormore employees. Importantly, Group 2 Entitiesalso include fund managers at the registeredentity level and superannuation funds if the valueof assets at the end of the financial year of theentity and the entities it controls is AU$5 billion.▪ Group 3: 1 July 2027: Entities that have at leastAU$50 million of consolidated revenue, AU$25million of consolidated gross assets, and 100 ormore employees.Details required to be incorporated in the“sustainability reports” include:▪ Material climate risks and opportunities (notingcertain smaller entities that do not face materialclimate risks and opportunities may state assuch).▪ Any metrics and targets of the entity for thefinancial year related to climate that are requiredto be disclosed pursuant to the Draft ReportingStandards, including metrics and targets relatingto Scope 1, 2, and 3 GHG emissions, withreporting of Scope 3 emissions to follow after a12-month grace period.2The AUASB has now issued the Australian Standardon Sustainability Assurance 5010 Timeline for Auditsand Reviews of Information in Sustainability Reports(the Standard) under the Corporations Act 2001 whichoutlines the proposed assurance phasing model. Thedetails of the Standard are not yet available but areexpected to specify how assurance requirements willbe phased in, with reasonable assurance required ofall climate-related disclosures made from yearscommencing on 1 July 2030 onward.In addition, the legislation contains some limitedimmunities which provide that, with respect to Scope 3emissions and scenario analysis, no legal action canbe made against a person in relation to statementsESG and the Sustainable Economy—19 February 2026 30made in sustainability reports lodged during thetransitional period. However, this limited immunitydoes not apply to criminal proceedings or where ASICbrings a civil claim and, with respect to that claim,there is a fault element or ASIC seeks an injunction ordeclaration as remedy.Where entities make incorrect statements in theirsustainability disclosure reports during this transitionalperiod, ASIC may direct the entity to confirm, explain,and rectify such errors. Where ASIC gives a direction,it must hold a hearing with the entity and providereasonable opportunity for the entity to makesubmissions.RG 280 incorporated feedback on:▪ ASIC's proposals to issue a regulatory guide forentities required to prepare a sustainability reportunder Ch 2M of the Corporations Act.▪ ASIC's proposals to facilitate sustainabilityreporting relief for stapled entities.▪ Broader questions, issues, or uncertainties thatmay inform our approach to any future guidance.RG 280 explains how ASIC will exercise specificpowers under legislation, how ASIC interprets the lawand the principles underlying ASIC's approach, as wellas provides practical guidance to entities aboutcomplying with their sustainability reportingobligations. Specifically, the regulatory guidance dealswith matters including how the sustainability reportshould be prepared, content required in thesustainability report, and how sustainability-relatedfinancial disclosures outside of the sustainabilityreport should be handled. RG 280 outlines ASIC'sapproach to the administration of sustainabilityreporting requirements, including for relief fromreporting requirements. Fund and asset managersshould consider the regulatory guidance as a usefulresource in respect of sustainability reporting.ASIC has encouraged reporting entities that arethinking of applying for relief from sustainabilityreporting to do so as early as possible.On 16 September 2025, ASIC also publishedresponses to some frequently asked questions aboutthe review and auditing requirements for thepreparation of sustainability reports under theCorporations Act.Importantly, ASIC has stated that:▪ An entity required to prepare a sustainabilityreport must have it reviewed or audited and obtainan auditor's report on the sustainability report.▪ The review or audit of the sustainability reportmust follow the auditing standards under theCorporations Act and be conducted by anindividual auditor, audit company, or audit firm.Additionally, ASIC also details what the audit reportmust include and what opinion the auditor must form.ASIC has noted that it will take a "pragmatic andproportionate approach" to the supervision andenforcement of the review and audit requirements,being more likely to take action if they see serious orreckless misconduct.On 31 October 2025, the ASX released ComplianceUpdate no. 12/25, announcing the release of aconsultation paper on proposed amendments to ASXListing Rule 17.5 following recent changes to theCorporations Act 2001 (Cth). Legislation now requiresmandatory annual sustainability reporting for certainlisted entities, potentially expanding the scope of ASXListing Rule 17.5 to include suspension of the listedentity's securities for late lodgement of sustainabilityreports.The ASX seeks to maintain the current approach,whereby mandatory suspension under ASX ListingRule 17.5 will only apply if an entity fails to lodge itsannual directors' report, statutory financial report, orauditor's report by the due date. Late submission ofESG and the Sustainable Economy—19 February 2026 31sustainability reports would not trigger automaticsuspension, preserving market stability while ensuringcompliance with new statutory requirements. As such,a listed entity's failure to lodge a sustainability reporton time will not automatically suspend trading in thatentity's securities.ARE THERE ANY CURRENT OR PROPOSEDREQUIREMENTS OUTSIDE OF DISCLOSUREAND REPORTING (E.G., PRODUCT-LEVELINVESTMENT REQUIREMENTS)?The third priority in the Australian government'sSustainable Finance Roadmap involves supportingcredible net-zero transition planning.On 15 August 2025, Treasury released itsconsultation paper on climate-related transitionplanning guidance. The objective of this guidance is tosupport organizations in planning for climate risks andopportunities which will help inform the decisionmaking of investors, lenders, and other stakeholders.Although it is not mandatory for organizations toprepare and publish transition plans under Australia'sclimate-related financial disclosures regime, AASB S2requires organizations to disclose certain informationto allow users of general purpose financial reports tounderstand how climate-related risks andopportunities affect the strategy and decision-makingof the organization. This includes disclosing anyclimate-related transition plan the organization has,the key assumptions used to develop the transitionplan, and any dependencies the transition plan reliesupon.The consultation paper makes it clear that theTreasury's transition planning guidance does notintend to be advice as to what information anorganization needs to disclose under the climaterelated financial disclosure regime. Rather, theguidance seeks to support best practice transitionplanning.Treasury's proposed guidance is directed by thefollowing design principles, such that the guidancewill:▪ Be internationally aligned, with the Treasuryendorsing the latest International FinancialReporting Standards Foundation's TransitionPlanning Taskforce Disclosure Framework.▪ Support domestic decarbonisation and adaptationto help organizations contribute to the 2050 netzero emissions target.▪ Balance ambition and flexibility.▪ Be focused on climate transition plans while alsorecognising other sustainability objectives oforganizations.Consultation closed on 24 September 2025.The APRA—which regulates Australian banks,insurers, and superannuation funds—has outlined itsexpectations for such entities with respect to theirconsideration of ESG factors in their investment riskmanagement framework and investment strategy inthe Prudential Practice Guide, SPG 530 InvestmentGovernance. This supports APRA's revised PrudentialStandard, SPS 530 Investment Governance, whichcommenced on 1 January 2023. Fund and assetmanagers are expected to consider ESG factors whenforming, implementing, and monitoring theirinvestment risk management framework andinvestment strategy. This report makes specificreference to the importance of stress testing and duediligence, with APRA expecting entities to considerscenarios that address climate risk, including bothphysical and transition risks. Once again, these aremerely guiding principles and do not createenforceable requirements.In November 2024, APRA released its Climate RiskSelf-Assessment Information Paper outlining theresults of the Self-Assessment Survey. The SelfAssessment Survey was carried out to “provide abetter understanding of the alignment of entities'ESG and the Sustainable Economy—19 February 2026 32practices with APRA's guidance on climate risk.” Keyinsights from the Self-Assessment Survey includedthe following:▪ Entities on average showed slightly lower maturityfor climate risk disclosure in 2024.▪ More mature governance structures are typicallyin place at entities where climate risk has beenintegrated into risk management.▪ Entities are starting to consider adjacent risks andpractices, such as nature risk and transition plans.APRA has signalled that it continues to lift itsexpectations for entities considering climate-relatedfinancial risks in their decision making. In 2025, APRAhas demonstrated that it intends to do the following:▪ Commence consultation on amending PrudentialStandard CPS 220 Risk Management (CPS 220)and Prudential Standard SPS 220 RiskManagement (SPS 220) to include climate risk.▪ Continue its work to understand how APRA canbest incorporate climate risk within its broadersupervision framework.Fund and asset managers should be aware thatchanges to CPS 220 and SPS 220 may result inchanges to APRA's approach to the integration ofclimate risk into risk management frameworks andfunctions more broadly.DO THE EXISTING OR PROPOSED RULESAPPLY EQUALLY TO OFFSHORE FUNDSBEING MARKETED IN THE REGION, OR DOTHEY APPLY SOLELY TO LOCALLYDOMICILED PRODUCTS?The disclosure obligations discussed previously andthe expectations of ASIC in relation to greenwashingwill apply to all investment products offered toAustralian investors, including those offered byoffshore managers. In addition, Australiansuperannuation funds will be seeking climate-relatedinformation from their asset managers (both local andoffshore) in order to ensure that they can comply withtheir disclosure obligations.The new legislation and the AASB ReportingStandards do not specifically consider the proposedapplication of mandatory climate-related reportingregimes to foreign companies operating in Australia.In that regard, the proposed mandatory regimeapplies to entities that meet the required sizethresholds for Group 1 and Group 2 Entities, or wherethey can be properly classified as a 2M Entity. Inaddition, the regime is proposed to apply to eachentity that is a registered corporation—or is requiredto be—under the National Greenhouse and EnergyReporting Act 2007 (Cth). According to the act,corporations are required to be registered if they:▪ Emit more than 50 kilotons of GHG or produce200 terajoules of energy for a financial year.▪ Are a constitutional corporation (meaning aforeign corporation, and trading or financialcorporation formed within the limits of theCommonwealth).▪ Do not have a holding company incorporated inAustralia.Interestingly, this could include a foreign-incorporatedentity that operates directly in Australia without anAustralian-incorporated subsidiary.RG 280 has clarified that foreign companies that areregistered under Div 2 of Pt 5B.2 of the CorporationsAct are not required to prepare a sustainability reportor keep sustainability records.Entities that have obtained relief from the requirementto prepare an annual financial report under Chapter2M will also not be required to prepare a sustainabilityreport or keep sustainability records.ESG and the Sustainable Economy—19 February 2026 33ARE ANY RULES IN PLACE FOR INVESTORS(VERSUS FUNDS AND FUND MANAGERS)?APRA's Prudential Practice Guide, SPG 530Investment Governance, has outlined its expectationthat RSE Licensees clearly articulate the extent towhich ESG considerations inform their investmentdecision making. APRA expects entities to considerESG factors at all stages of the investment process,including in formulating the investment strategy anddetermining an appropriate level of diversification,conducting due diligence, and monitoring investmentperformance. Therefore, as superannuation funds are“RSE Licensees,” this will incidentally impact fundmanagers whose clients are typically superannuationfunds; these considerations will be passed from thesuperannuation fund through to the manager.Investors may also be subject to Australia's climaterelated reporting regime, as discussed above, if theycan be classified as a Group 1 Entity, Group 2 Entity,Group 3 Entity, or 2M Entity.ARE THERE OTHER ACTIONS OR INITIATIVESTHAT COULD IMPACT FUNDS ANDMANAGERS?As part of ASIC's continued Sustainable Financeenforcement priority, ASIC continues to focus ongreenwashing, most recently issuing a penalty ofAU$10.5 million against Active Super for false andmisleading representations in relation to ESGdisclosures.Action taken by ASIC to date includes action inrelation to:▪ Scope and application of sustainability-relatedinvestment screens being overstated orinconsistently applied.▪ Vague and insufficiently explained terms whendescribing investment approach.▪ Inaccurate representations of an investmentscreen in an index methodology.▪ Projects or products being described as “carbonneutral,” “clean,” or “green” with no reasonablebasis for these claims.▪ Net-zero statements and targets not having areasonable basis or were factually incorrect.Action Arising Out of Insufficient ExclusionaryScreeningOn 25 September 2024, the Federal Court ruled on anASIC greenwashing action resulting in a recordAU$12.9 million penalty. The Federal Court found theproduct issuer contravened the ASIC Act by makingfalse or misleading representations about certain ESGexclusionary screens applied to investments inrespect of a quoted index fund (the Fund).The representations were made to the public in arange of communications, including an interview onYouTube, a presentation at a fund manager event, amedia release, and statements published on theproduct issuer's website. Investments held by the fundwere based on the Bloomberg Barclays MSCI GlobalAggregate SRI Exclusions Float Adjusted Index(Index). The product issuer had claimed the Indexexcluded only companies with significant businessactivities in a range of industries, including thoseinvolving fossil fuels, but has admitted that asignificant proportion of securities in the Index and theFund were from issuers that were not researched orscreened against applicable ESG criteria.The case highlights the importance of disclosure andthe importance of clarifying how any ESG screening isapplied across a fund portfolio.Action Arising Out of Unequivocal LanguageOn 5 June 2024, in an action brought by ASIC againsta superannuation entity with approximately AU$13.5billion in superannuation assets, the Federal Courthas found that the superannuation entity madeESG and the Sustainable Economy—19 February 2026 34misleading ESG claims by stating that it had noinvestments posing too great a risk to the environmentand the community.In its marketing material, the superannuation entityused language, such as “No Way” and “eliminate,”which the court found to be unequivocal statementsthat were not the subject of any potentialqualifications. However, in reality, the superannuationentity had direct or indirect exposure (throughmanaged funds or ETFs) to securities with theexposure to gambling, oil tar sands, and coal mining,as well as sanctioned entities.In this case, the trustee was ordered to pay anAU$10.5 million penalty and ASIC's costs.Action Arising Out of Misleading Characterisationof Investment ProductsOn 2 August 2024, in an action brought by ASICagainst a major superannuation trustee, the FederalCourt found that the trustee made misleadingstatements about the sustainable nature andcharacteristics of some of its investment products.It was found the trustee had statements on its websitemarketing certain sustainability-focused investmentproducts as suitable for members who were “deeplycommitted to sustainability” because they excludedinvestments in companies involved in carbonintensive fossil fuels, alcohol products, and gambling.In reality, the investment products in question haddirect investee companies which were involved in thestated exclusionary business purposes.In this case, the trustee was ordered to pay anAU$11.3 million penalty and ASIC's costs.WHAT IS ON THE HORIZON?The introduction to sustainability reporting is a "oncein a generation" change to the reporting obligations ofcorporate Australia. ASIC will be responsible foradministering sustainability reporting requirements inthe Corporations Act and will monitor entities'compliance with the new requirements. Whilemodified liability settings apply until the financial yearending 31 December 2028, these only apply to certainstatements and do not apply to any voluntarystatements made outside of sustainability reports orauditors' reports.Further guidance on the content of sustainabilityreports will come with the submission of Group 1entities reports in the second quarter of 2026.The ASFI released the Australian sustainable financetaxonomy on 17 June 2025. The taxonomy offersbusinesses a robust, "Paris-aligned" voluntaryframework to confidently invest in net-zero projects.ASFI will be working with Australia's leading financialinstitutions to pilot the taxonomy in the making of realworld investment decisions over several months.EUROPEESG and the Sustainable Economy—19 February 2026 36EUROPEAN UNIONBy Gayle Bowen (Ireland), Andrew J. Massey (UnitedKingdom), Adam M. Paschalidis (Luxembourg), andDr. Philipp Riedl (Germany)WHAT RULES, IF ANY, ARE CURRENTLY INPLACE (I.E., HAVE BEEN ADOPTED) FORFUNDS AND ASSET MANAGERS?Sustainable Finance Disclosure RegulationThe European Union's SFDR3 and its DelegatedRegulation4require FMPs (including fund managersand other asset managers) to make certainprospectus, website, and other disclosures regardinghow ESG factors, risks, and impacts are integratedinto their processes and products at both the FMPlevel and the applicable product level. The SFDR is akey aspect of the European Union's wider sustainablefinance policy, designed to attract private investmentto support the transition to a sustainable economy. Itdoes this by requiring FMPs to be transparent toinvestors with respect to sustainability risks and howthey may affect financial returns, as well as theimpact that investments may have on the environmentand society. This approach is known as “doublemateriality.”EU Taxonomy RegulationThe EU Taxonomy Regulation5 and its DelegatedRegulations (including the TSCs) set out aclassification system (the EU Taxonomy) that currentlyestablishes economic activities that can be consideredenvironmentally sustainable. Under the EUTaxonomy, an activity is considered environmentallysustainable (also referred to as "taxonomy-aligned") ifthe activity does the following:▪ Contributes substantially to one of sixenvironmental objectives identified in the EUTaxonomy Regulation.▪ Does not do any significant harm to any of the sixenvironmental objectives.▪ Avoids violation of minimum social impacts.▪ Complies with the relevant TSCs.The six environmental objectives comprise twoclimate-related objectives and four nonclimate-relatedenvironmental objectives. The TSCs set out additionaldetails and requirements, including for the climaterelated objectives and the criteria for determining ifactivities cause significant harm to otherenvironmental objectives. The TSCs specify criteriafor particular sectors, including the manufacturing,energy, transportation, construction and real estate,and information and communication sectors. Therequirement for a company to assess (and report on)whether a specific economic activity is EU Taxonomyaligned is now subject to a materiality threshold,introduced as part of the Omnibus package(discussed further below). An activity will not be(financially) material if it accounts for less than 10% ofa company's total revenue, capital expenditure, oroperational expenditure.The EU Taxonomy Regulation interacts with otherlegal acts, and significantly with the SFDR. Inparticular, a financial product (e.g., a fund or amanaged account) is deemed to be makingenvironmentally sustainable investments for thepurposes of the SFDR if its investments are alignedwith the EU Taxonomy Regulation.Organisational RequirementsEU financial market players—including UCITSmanagement companies, AIFMs, and firms subject toMiFID II (e.g., investment firms, broker-dealers, andother entities that provide investment-relatedservices)—are required to observe specific ESGrelated measures relating to ESG risk management.For example, such firms must take into account risksrelated to sustainability with respect to reporting, riskcontrolling, and internal policies.ESG and the Sustainable Economy—19 February 2026 37MiFID Code of ConductMiFID II firms that provide investment advice arerequired to consider their clients' sustainabilitypreferences when determining the clients' respectiveinvestment objectives and selecting suitable financialproducts. For example, such firms must consider theextent to which clients require that a minimum portionof their assets be invested in environmentallysustainable investments (EU Taxonomy-aligned) orother sustainable investments (as defined in theSFDR), and whether clients require that financialproducts consider PAIs on sustainability factors.MiFID II firms must also take into accountsustainability risks when providing investment advice.Corporate Sustainability Reporting DirectiveThe CSRD is a European directive that requirescertain companies to report on sustainability matterson a double-materiality basis. The mandatoryrequirements are being applied on a roll-out basis,which started in 2024:▪ 1 January 2024 for certain in-scope public interestentities with more than 500 employees (Wave 1).▪ 1 January 2025 for other larger companies andpublic interest entities with more than 250employees (Wave 2).▪ 1 January 2026 for listed SMEs, with an “opt out”possible until 2028 (Wave 3).The scope of companies subject to CSRD is tochange as a result of the simplification measures(discussed under “What Is on the Horizon?” below).The CSRD complements the SFDR in that the dataand reporting produced and published by companiesunder the CSRD may be used by FMPs in thepreparation of the disclosures required under theSFDR. The availability of sustainability reports andadditional data under the CSRD is intended toenhance the quality of disclosures to investors underthe SFDR.Corporate Sustainability Due Diligence DirectiveThe CSDDD is a European directive that, from 2029,will require certain (large) companies to identify,prevent, and mitigate potential or actual adversehuman rights and environmental impacts connectedwith their operations, including both upstream andcertain downstream impacts. It will impose a duediligence obligation on in-scope companies withrespect to their supply chain (upstream anddownstream). It will be supported by requirementsrelating to governance, a requirement for publicreporting, a requirement for companies to establishnotification and complaints mechanisms, and thepower to impose financial penalties fornoncompliance. As part of the Omnibus package(discussed further below), changes are being made tothe original CSDDD that will “simplify” certain of thoserequirements.WHAT LABELS OR CATEGORIES, IF ANY, ARECURRENTLY REQUIRED OR HAVE BEENPROPOSED FOR FUNDS AND ASSETMANAGERS?While the European Union has not (yet) formallyadopted ESG “labels” or “categories” for financialproducts, in practice, financial products are oftendescribed according to the applicable SFDRdisclosure obligations:▪ “Article 6 product”—no ESG strategy.▪ “Article 8 product”—ESG strategy.▪ “Article 8+ product”—ESG strategy and aminimum proportion of EU Taxonomy-alignedinvestments or other sustainable investments(SFDR-aligned).▪ “Article 9 product”—exclusively EU Taxonomyaligned investments or other sustainableinvestments (SFDR-aligned).ESG and the Sustainable Economy—19 February 2026 38The disclosure obligations are described in greaterdetail below.WHAT DISCLOSURE AND REPORTINGREQUIREMENTS ARE CURRENTLY REQUIREDOR HAVE BEEN PROPOSED FOR FUNDS ANDASSET MANAGERS?The SFDR and EU Taxonomy Regulation provide forfour basic disclosure and reporting obligations:Sustainability Risks (SFDR Articles 3, 5, and 6)FMPs are required to disclose if and how theyintegrate sustainability risks into their investmentdecisions in relation to a financial product, as well asthe impact of sustainability risks (including transitionrisks) on the returns of the financial product and theremuneration of their employees. To the extent thatsustainability risks are considered irrelevant,participants must explain why. These disclosurerequirements apply to all FMPs and to all financialproducts. Disclosures must be made on an entity (i.e.,firm, asset manager) level on the firm's website andon a product (i.e., fund, managed account) level in aprecontractual document (e.g., prospectus, privateplacement memorandum).Approach to Principal Adverse Impacts onSustainability Factors (SFDR Articles 4 and 7)All FMPs are generally required to comply with thePAI disclosure requirements on an entity level and aproduct level. Accordingly, firm websites and productdocuments must include disclosures regarding howPAIs on environment, social, and employee mattersare considered when investment decisions are made.In addition, on an annual basis, firms and productsmust provide information about quantitative impacts(e.g., GHG emissions, energy consumption) of thefirm's managed portfolio and the respective product.An exemption from this disclosure requirement maybe available for smaller firms. If an FMP does notconsider PAIs, there must be a clear statement of thisand the reason for not doing so.Products Investing in Sustainable Investments(SFDR Articles 9, 10, and 11)An FMP is required to disclose whether a financialproduct has sustainable investments as its investmentobjective. For these purposes, sustainableinvestments refer to the following:▪ An investment in an economic activity thatcontributes to an environmental or socialobjective.▪ The investment does not significantly harm anyenvironmental or social objective.▪ Investee companies follow good governancepractices, in particular with respect to soundmanagement structures, employee relations,remuneration of staff, and tax compliance.An Article 9 financial product must comply with thesame disclosure requirements applicable to an Article8 financial product. In addition, an Article 9 financialproduct must state whether the fund will invest in EUTaxonomy-aligned investments and provide enhanceddisclosure on PAIs. As a result, the compliance, duediligence, and reporting burden is greater for Article 9financial products.Products Promoting Environmental or SocialCharacteristics (SFDR Articles 8, 10, and 11)If a financial product promotes environmental or socialcharacteristics, information must be providedregarding such characteristics, the indicators used tomeasure the attainment of the promoted ESGstrategy, and the binding elements of the ESGstrategy. An Article 8 financial product must (amongother matters) make certain precontractualdisclosures (using the SFDR template), publish awebsite disclosure explaining the characteristics beingpromoted and how they were promoted, and publishan annual periodic disclosure on how thecharacteristics were promoted during the reportingperiod. For financial products promotingenvironmental or social characteristics and committingESG and the Sustainable Economy—19 February 2026 39to make a minimum proportion of sustainableinvestments (known as "Article 8+ financial products"),information regarding allocation of sustainableinvestments is also required.ARE THERE ANY CURRENT OR PROPOSEDREQUIREMENTS OUTSIDE OF DISCLOSUREAND REPORTING (E.G., PRODUCT-LEVELINVESTMENT REQUIREMENTS)?ESMA has published guidelines for fund namescontaining ESG or sustainability-related terms. Theguidelines state the expected minimum sustainabilityrequirements for funds using particular terms, assummarized below. The guidelines are relevant to EUmanagers and managers of funds marketed into theEuropean Union (as discussed further below under“Do the Existing or Proposed Rules Apply Equally toOffshore Funds Being Marketed in the Region, or DoThey Apply Solely to Locally Domiciled Products?”).Funds using transition-, social-, and governancerelated terms (e.g., “transition,” “transformation,” “netzero,” “social,” “equality,” or “governance”) should:▪ Meet an 80% threshold linked to the proportion ofinvestments used to meet environmental or socialcharacteristics or sustainable investmentobjectives in accordance with the bindingelements of the investment strategy disclosed incompliance with SFDR.▪ Apply certain EU-Climate Transition Benchmarkexclusions (i.e., companies involved in anyactivities related to controversial weapons ortobacco or companies in violation of the UnitedNations Global Compact's principles or theOrganisation for Economic Co-operation andDevelopment Guidelines for MultinationalEnterprises).Funds using environmental- or impact-related terms(e.g., “green,” “environmental,” “climate,” “ESG,”“SRI,” or “impact”) should:▪ Meet an 80% threshold linked to the proportion ofinvestments used to meet environmental or socialcharacteristics or sustainable investmentobjectives in accordance with the bindingelements of the investment strategy disclosed incompliance with SFDR.▪ Apply all EU Paris-Aligned Benchmark exclusions(i.e., in addition to the above-mentionedcompanies, companies that derive a certainpercentage of their revenues from businessactivities in relation to coal, oil fuels, gaseousfuels, or electricity generation with a high GHGintensity).Funds using terms derived from the word“sustainable” should:▪ Meet an 80% threshold linked to the proportion ofinvestments used to meet environmental or socialcharacteristics or sustainable investmentobjectives in accordance with the bindingelements of the investment strategy disclosed incompliance with SFDR.▪ Apply all EU Paris-Aligned Benchmark exclusions.▪ Commit to invest meaningfully in sustainableinvestments referred to in the SFDR (in itsquestions and answers, ESMA clarified that thismeans a proportion of sustainable investments ofat least 50%).According to ESMA's questions and answers, the EUParis-Aligned Benchmark exclusions do not need tobe assessed for the three categories above wheninvesting into green bonds under the EU Green BondRegulation.The guidelines apply to new funds from 21 November2024, and existing funds from 21 May 2025. Sincethey are guidelines, adoption is dependent on whetherthe national competent authority in each EU memberstate will require compliance with those guidelines. Asof 16 July 2025, most member states had confirmedESG and the Sustainable Economy—19 February 2026 40to ESMA that they require compliance with theguidelines.DO THE EXISTING OR PROPOSED RULESAPPLY EQUALLY TO OFFSHORE FUNDSBEING MARKETED IN THE REGION, OR DOTHEY APPLY SOLELY TO LOCALLYDOMICILED PRODUCTS?The disclosure and reporting requirements under theSFDR also apply to non-EU asset managers andfunds (i.e., non-EU funds with an EU or non-EU AIFMthat are marketed in the EU). There remains someambiguity regarding whether a non-EU fund would berequired to comply with the foregoing obligationswhere interests in the fund (i.e., shares or units) aredistributed to an EU investor at the initiative of theinvestor (known as a reverse solicitation). In relationto the ESMA guidelines on fund names (discussedabove), while the guidelines themselves are silent onwhether they apply to non-EU managers of fundsbeing marketed in the EU, the current prevailing viewis that they do apply in such circumstances.ARE ANY RULES IN PLACE FOR INVESTORS(VERSUS FUNDS AND FUND MANAGERS)?Certain types of institutional investors are subject tosustainability-related requirements. For example,insurance companies and pension scheme providersmay themselves be FMPs subject to SFDR, or may bewithin scope of the CSRD and CSDDD.ARE THERE OTHER ACTIONS OR INITIATIVESTHAT COULD IMPACT FUNDS ANDMANAGERS?The ESG Rating Regulation, a regulatory frameworkfor ESG rating agencies that is intended to enhancetheir transparency and integrity, has passed and willapply on 26 July 2026. It will apply to ratings thatprovide an opinion on a company's or a financialinstrument's sustainability profile by assessing itsexposure to sustainability risk and its impact onsociety and the environment. Under the ESG RatingRegulation, EU providers of ESG ratings will require alicense from, and be supervised by, ESMA. Theregulation imposes certain operational requirements,such as rules relating to the methodology for ratingsand certain disclosure requirements. It provides forthe possibility of issuing separate ESG ratings. If onlya single rating is issued, the weighting of the ESGfactors will need to be stated. Non-EU rating providerswishing to operate in the European Union will need tohave their ESG ratings endorsed by an authorised EUESG rating provider. An EU Commission equivalencedecision in relation to their country of origin may alsogive third-country providers access to the EuropeanUnion. Until the EU Commission has adopted suchdecision, small rating providers (annual turnoverbelow €12 million) outside the European Union mayalternatively seek recognition by ESMA if they applythe ESG Rating Regulation's requirements (other thanlicensing). ESG rating providers that are active in theEuropean Union are required to apply for a license orfor recognition before 2 November 2026. ESMA iscurrently consulting on the RTS that will set outdetailed rules for ESG rating providers.WHAT IS ON THE HORIZON?On 20 November 2025, the EU Commission publisheda proposal to amend the SFDR. The proposedchanges would replace the current disclosureobligations under Articles 6, 8, and 9 of the SFDR withdisclosure requirements that would depend on howthe product is categorized under a new productcategorization system. The proposed categorizationsare as follows:▪ Products with transition-related objectives (draftArticle 7 SFDR).▪ Products with integrated sustainability factors(draft Article 8 SFDR).ESG and the Sustainable Economy—19 February 2026 41▪ Products with sustainability-related objectives(draft Article 9 SFDR).All three categories would require a 70% allocation tothe respective ESG strategy, as well as compliancewith other requirements (some of which would bedifferent for the different categories). It is proposed toremove the requirement for entity-level disclosuresregarding PAIs, and the concept would be largelyabandoned at the product level. It is also proposedthat the SFDR requirements would no longer apply toportfolio management and investment advisoryservices. In addition, special AIFs that admit onlyprofessional investors would be excluded from theproduct categorization rules, and it is proposed tohave transitional provisions that would exemptexisting closed-ended funds. It is important to notethat the draft directive is currently under negotiation bythe European legislative bodies and is thereforesubject to change.As part of the prevailing desire to simplify regulatoryrequirements and reduce the administrative burden onFMPs and small- and medium-sized businesses, theEU bodies have been working on the so-called“Omnibus” package. This includes changes to theCSRD, CSDDD, and the EU Taxonomy Regulation.Certain of the changes have now taken effect, asnoted above. In December 2025, agreement wasreached on the Omnibus simplification package. As anext step, the amendments will be formally approvedby the European Council, published in the OfficialJournal of the European Union, and will becomeeffective 20 days after their publication. These willinclude changes to the scope of entities subject to theCSRD, postponement of the application date ofCSDDD, and removal of mandatory transitionplanning for companies from the CSDDD.CONSIDERATIONS FOR IRELAND ANDLUXEMBOURGAsset managers offering funds or other services in EUcountries should bear in mind that some suchindividual countries may have additionalconsiderations or guidelines. Ireland and Luxembourgare two popular domiciles for establishing funds forcross-border distribution, not just across the EuropeanUnion but globally as well. Asset managers shouldidentify additional requirements in the country wherethe fund is domiciled, in the country of the investmentmanager (if different to the fund domicile), and in thecountries where the fund is distributed.IrelandThe position in Ireland to date has been to apply therequirements of the SFDR without any “gold-plating”(i.e., implementation that exceeds what is necessaryto incorporate a directive). The Central Bank of Ireland(the Central Bank) is nonetheless very focused on itsrole as a key gatekeeper in this area, with Irelandbeing the second-largest, and fastest-growing, funddomicile in the European Union and the largest ETFdomicile in Europe. Of all Irish-domiciled funds,approximately 25% are Article 8, Article 8+, or Article9 funds, and that portion of the overall Irish-domiciledfund universe is expected to grow.Following the publication of ESMA's fund-namingguidelines on 21 August 2024 (discussed above), theCentral Bank launched a fast-track for funds beingrenamed as a result of the ESMA guidelines. The fasttrack facilitated changes in relation to fund names, aswell as minor changes to disclosures in fund offeringdocuments and precontractual documents made withthe sole purpose of aligning the fund with the ESMAguidelines.Any new funds created on or after the application date(being 21 November 2024) should be compliant withthe ESMA fund-naming guidelines.LuxembourgIn an effort to further enhance Luxembourg'sreputation as an attractive place to organise andoperate investment funds, particularly alternativeinvestment products, while also maintaining qualityESG and the Sustainable Economy—19 February 2026 42control, the Luxembourg financial regulator, theCSSF, has, sought to create a level and transparentplaying field for all FMPs conducting business inLuxembourg and to facilitate FMPs' compliance withSFDR. In seeking to achieve these goals, the CSSF:(a) implemented an expedited process for FMPs toreview, amend, and obtain CSSF authorisation6fortheir funds' documents for purposes of complying withSFDR disclosure requirements; (b) requiresinvestment fund managers, among others, tocomplete an annual SFDR questionnaire inaccordance with the financial year-end of the financialproducts that will be used to determine the level ofcompliance of the FMPs with SFDR and ESGstandards; and (c) has issued a frequently askedquestions document, “FAQ Sustainable FinanceDisclosure Regulation (SFDR),” initially in 2022 andwhich is kept up to date (last updated 18 December2024)Furthermore, on 22 March 2024, the CSSF'ssupervisory priorities in the area of sustainablefinance were published. In this paper, the CSSFoutlines areas of focus that will be prioritised in termsof supervision. A significant revelation in thiscommuniqué is that the CSSF intends to ensurecompliance and, most importantly, consistency acrossthe fund documentation and marketing material in thecontext of financial products. This confirms legalpractitioners' expectations that the Luxembourgregulator would at some point attempt to effectivelyintervene and perform checks on FMPs' disclosures inorder to ensure effective transparency for investors.In light of the ESMA's report on the CSA, the CSSFpublished a feedback report on 30 September 2025wherein it was noted that the overall level ofcompliance for Luxembourg-domiciled investmentfund managers is consistent with ESMA's conclusions.This feedback report also presented the mainobservations, related recommendations forimprovements, and examples of good practices, aswell as CSSF's recommendation to AIFMs to conducta comprehensive assessment of their compliance withobservations in the ESMA's report and CSSF'sfeedback reports, as well as take necessary correctivemeasures.At the end of October 2025, CSSF followed up on itsprevious report on the current situation of net assetsof authorised UCIs (including UCITS and AIFs, butexcluding RAIFs) that are disclosing under Article 8and Article 9 of the SFDR. Article 8 UCIs have seen aslight rise and continue to lead with net assets of€3,821,374.8 million, while Article 6 UCIs seem to beholding a significant grip (€2,151,318.7 million), evenrecording a slight increase since the previousreporting. Article 9 UCIs had significantly fewer assetsof only €189,607.8 million, justifying their nature, asthey appeal to certain investors while having tocomply with a stricter regulatory framework. It is alsoto be noted that the balance between subscriptionsand redemptions is leaning toward subscriptions(+€22,099.4 million). The report also classifies UCIsaccording to (a) the environmental or social objectivesthey are pursuing, with UCIs pursuing socialobjectives (€2,172,464.2 million) continuing tooutpace UCIs promoting “climate change mitigation”as their objective (€2,094,982.8 million); and (b) theinvestment strategies they apply, with UCIs applying“Exclusions” (€3,193,537.7 million) continuing tomarginally beat out those implementing “ESGintegration” in their investment strategies(€2,910,081.5 million).ESG and the Sustainable Economy—19 February 2026 43UNITED KINGDOMBy Zainab Kuku and Andrew J. MasseyWHAT RULES, IF ANY, ARE CURRENTLY INPLACE (I.E., HAVE BEEN ADOPTED) FORFUNDS AND ASSET MANAGERS?As part of the FCA's SDR, the FCA has introduced an“antigreenwashing” rule. The rule applies in relation tosustainability claims, and is additional to the existinggeneral rules and principles in the FCA Handbook thatrequire clear, fair, and not misleadingcommunications. All FCA-authorised firmscommunicating with UK prospects or clients in theUnited Kingdom in relation to a product or service arerequired to comply with the antigreenwashing rule.The antigreenwashing rule applies indirectly to nonUK products managed by non-UK firms in relation tosustainability claims communicated to a person in theUnited Kingdom by an FCA- or PRA-authoriseddistributor.The FCA's SDR regime also introduced naming andmarketing rules for certain types of products. Theserules have different components. First, ESG-relatedlabels have been available for FCA-authorised firms touse in relation to UK funds (since 31 July 2024),subject to compliance with relevant rules whichinclude naming and marketing and disclosurerequirements (see further below). Second, forunlabelled products, there are requirements relating topermitted names, marketing, and required disclosures(see further below).In relation to climate-related disclosures, the UKgovernment has been supportive of the standardsestablished by the TCFD. FCA-authorised firms withat least £5 billion of assets under management of inscope activities must prepare and publish a TCFD“entity report” (i.e., a public report that outlines anasset manager's approach to climate-related matterswhen managing or administering investments onbehalf of clients) and “public TCFD product reports”(i.e., reports containing disclosures regarding keymetrics, such as GHG emissions, in relation to thefunds and separate accounts managed by the assetmanager) on an annual basis. FCA guidance alsoencourages UK asset managers to assess the extentthat they have considered the United Kingdom'scommitment to a net-zero economy in developing anddisclosing their transition plan as part of their entityreport or otherwise explain why they have not donethis.There are other more general provisions within theFCA's rules and guiding principles that will or mayapply to ESG investment strategies, even if thoseprovisions are not specifically ESG related. Theseinclude, by way of example, the overarching Principlesfor Business (Principles), which set out, asenforceable rules, high-level standards of marketconduct. Those Principles include, for example,requirements that firms: (a) must conduct businesswith integrity; (b) must communicate information totheir clients in a manner that is clear, fair, and notmisleading; and (c) must ensure that a communicationor a financial promotion is fair, clear, and notmisleading. The Principles also include a “ConsumerDuty” requiring firms to act to deliver good outcomesfor consumers, including supporting consumerunderstanding by communicating information to themin a way that is clear, fair, and not misleading.Specifically for FCA-authorised (retail) funds,managers should consider the FCA's guidingprinciples on the design, delivery, and disclosure ofESG and sustainable investment funds set forth in theFCA's “Dear Chair” letter dated 19 July 2021 (GuidingPrinciples). The Guiding Principles state the FCA'sexpectations for UK FCA-authorised funds that makeESG-related claims. The Guiding Principles arerelevant to both new products and existing ones.Aside from regulations specifically applicable tofinancial services firms, there are other UK laws, rules,ESG and the Sustainable Economy—19 February 2026 44and guidance that may also be relevant to ESGrelated claims made to UK persons. These include, forexample, the rules on misleading statements andimpressions under Sections 89 and 90 of the FinancialServices Act 2012, which may impose criminal liabilityin certain egregious cases. Other rules and codesapply in relation to businesses—including assetmanagers, funds, and fund distributors—that areselling to UK consumers (i.e., natural persons). Thisincludes the rules found in the CMA's guidance onmaking environmental claims on goods and servicespublished on 20 September 2021, often referred to asthe “Green Claims Code.” The CMA also sharescertain consumer protection functions with the ASA,which administers the requirements for advertising inthe UK Code of Non-Broadcast Advertising and Directand Promotional Marketing and the UK Code ofBroadcast Advertising. The ASA has issued guidancedesigned to help firms interpret the codes regardingenvironment-related advertising issues.WHAT LABELS OR CATEGORIES, IF ANY, ARECURRENTLY REQUIRED OR HAVE BEENPROPOSED FOR FUNDS AND ASSETMANAGERS?The FCA's SDR regime currently applies only to(broadly) FCA-authorised asset managers. Itis expected to expand and evolve over time. The SDRintroduced certain core elements: (a) sustainableinvestment labels, (b) qualifying criteria that firms mustmeet to use a label, (c) product- and entity-leveldisclosures, and (d) naming and marketing rules.Under the SDR, the FCA has introduced an optionallabelling regime for FCA-authorised firms to use inrelation to UK funds. The labels are not currentlyavailable for non-UK funds, even if the non-UK fund ispermitted to be distributed in the United Kingdomunder the United Kingdom's overseas fundsregime. The labelling regime, and disclosure andnaming and marketing requirements applicable wherea label is used, took effect on 31 July 2024. Allproducts using a label must have a sustainabilityobjective to improve or pursue positive environmentalor social outcomes as part of their investmentobjectives. Firms must identify and disclose whetherpursuing the positive sustainability outcomes mayresult in material negative outcomes.The available labels are:▪ Sustainable Focus: The sustainability objectivemust be consistent with an aim to invest inenvironmentally or socially sustainable assetsdetermined using a robust evidence-basedstandard that is an absolute measure ofsustainability.▪ Sustainable Improvers: The sustainabilityobjective must be consistent with an aim to investin assets that have the potential to improveenvironmental or social sustainability over time—determined by their potential to meet a robust,evidence-based standard that is an absolutemeasure of environmental or social sustainability.▪ Sustainable Impact: The sustainability objectivemust be consistent with an aim to achieve apredefined positive measurable impact in relationto an environmental or social outcome, measuredusing a robust method. These products must alignwith a clearly specified theory of change.▪ Sustainability Mixed Goals: Products with asustainability objective to invest in accordancewith two or more of the sustainability objectives ofthe other three labels. Firms must identify (anddisclose) the proportion of assets invested inaccordance with any combination of the otherlabels.Subject to limited exceptions, at least 70% of alabelled product's assets must be invested inaccordance with its sustainability objective. However,in the case of the Sustainability Mixed Goals label,products must invest at least 70% of their assets inESG and the Sustainable Economy—19 February 2026 45accordance with a combination of the sustainabilityobjectives from two or more of the other labels.Since 2 December 2024, UK distributors to UK retailclients of overseas funds that: (a) have beenrecognised for UK retail distribution (includingrecognised ETFs); and (b) include certainsustainability-related terms, are required to prepareand display a notice that, “This product is basedoverseas and is not subject to UK sustainableinvestment labelling and disclosure requirements.”As mentioned above, the labels are not available fornon-UK funds that are sold to UK investors. Non-UKfunds are subject to the overseas product notice rulementioned in the previous paragraph, and they maybe indirectly subject to the antigreenwashing rule, asdiscussed above. The FCA has disclosed its intentionto work with the UK government to consider optionsas to whether and how non-UK funds may be able touse labels. A UK government consultation on thepossible extension of SDR, including labels, to fundsadmitted to the United Kingdom's overseas fundsregime was expected but is yet to materialise.WHAT DISCLOSURE AND REPORTINGREQUIREMENTS ARE CURRENTLY REQUIREDOR HAVE BEEN PROPOSED FOR FUNDS ANDASSET MANAGERS?The current disclosure requirements are principally setforth in the FCA's ESG Sourcebook. There arebroadly two sets of disclosure requirements:▪ Disclosures on climate-related matters inaccordance with the TCFD recommendations.This requires entity disclosures for FCAauthorised firms and product disclosures for inscope products.▪ Disclosures on sustainability matters under theFCA's SDR regime. This requires entitydisclosures for FCA-authorised firms carrying onin-scope business and product disclosures for inscope products.Specifically in relation to the SDR regime, thedisclosure requirements include: (a) for in-scopeproducts, a requirement for a consumer-facingdisclosure document that is intended to helpconsumers understand the key sustainability-relatedfeatures of the product; (b) for in-scope products,required precontractual disclosures regarding theproducts sustainability-related features to be includedin the offering document; (c) for in-scope products,ongoing sustainability-related performance informationto be disclosed in sustainability product reports; and(d) sustainability entity reports covering how firms aremanaging sustainability-related risks andopportunities.In-scope firms undertaking in-scope business for retailclients and using certain ESG-related terms in anunlabelled fund's name or financial promotions havebeen required to comply with disclosure requirementsunder the SDR. For each of the product disclosuresdescribed above, the SDR requires additional, moredetailed information to be disclosed if the productuses an SDR label.ARE THERE ANY CURRENT OR PROPOSEDREQUIREMENTS OUTSIDE OF DISCLOSUREAND REPORTING (E.G., PRODUCT-LEVELINVESTMENT REQUIREMENTS)?As part of the SDR, the FCA has imposed newnaming and marketing requirements on FCAregulated firms that provide in-scope products to retailinvestors and use sustainability-related words inproduct names or marketing. Since 2 December 2024,in-scope products that are not labelled products havenot been able to use the terms “sustainable,”“sustainability,” or “impact,” or any variation of thoseterms, in their names.Other sustainability-related words (e.g., “responsible”or “green”) may only be used in the nonlabelledESG and the Sustainable Economy—19 February 2026 46product's name if the product has sustainabilitycharacteristics that the product's name accuratelyreflects. The new rules also prohibit “SustainabilityFocus,” “Sustainability Improvers,” and “SustainabilityMixed Goals” labelled products from using the term“impact” in product names, and this rule will apply tolabelled products from the date on which the label isfirst used. A nonlabelled product will only be able touse a sustainability-related term in its name ormarketing material if the relevant firm: (a) complieswith the “antigreenwashing” rule referred topreviously, (b) publishes the disclosures requiredunder the SDR regime (see the previous sectionabove), and (c) prominently publishes a statement toclarify that the product does not have a label and thereasons why.As part of the SDR, where in-scope products areoffered to retail investors and have an investmentlabel, FCA-authorised distributors must displayprominently, and keep up to date, the correct label ona relevant digital medium (e.g., product webpage) andprovide access to the accompanying retail investorfacing disclosures. In relation to nonlabelled productsthat use sustainability-related terms in their names ormarketing, distributors will be required to provide retailinvestors with access to the required consumer-facingdisclosure.DO THE EXISTING OR PROPOSED RULESAPPLY EQUALLY TO OFFSHORE FUNDSBEING MARKETED IN THE REGION, OR DOTHEY APPLY SOLELY TO LOCALLYDOMICILED PRODUCTS?In general, the rules discussed herein do not apply tooffshore funds being marketed in the United Kingdom.However, as discussed above, the antigreenwashingand overseas product notice rules apply indirectly tooffshore funds being marketed in the United Kingdomwhere a UK distributor is used. As noted previously,we expect a UK government consultation on thepossible extension of the SDR, including labels, tofunds admitted to the United Kingdom's overseasfunds regime. The timing of this is currently uncertain.ARE ANY RULES IN PLACE FOR INVESTORS(VERSUS FUNDS AND FUND MANAGERS)?There are specialist rules in place for, for example,pension schemes, which aim to create greatertransparency and oversight within the pension sector.Trustees of certain pension funds are required toreport and publish climate-related risks. The impact onfunds and fund managers is that if their underlyinginvestors include an affected pension scheme, therelevant pension scheme investor may insist on a fundor fund manager making pertinent disclosures to thepension scheme to allow the scheme to assessclimate-related risks.ARE THERE OTHER ACTIONS OR INITIATIVESTHAT COULD IMPACT FUNDS ANDMANAGERS?The UK government has recently consulted on draftUK SRS, based on the ISSB standards. This is part ofthe UK government's plans to modernize the UnitedKingdom's framework for corporate reporting.Once the SRS have been finalized, the FCA willconsult on the adoption of these standards by listedcompanies. The UK government has decided that itwill not produce a UK-specific taxonomy inconjunction with these or other sustainabilitydisclosure requirements.The UK government has previously committed tomandating UK-regulated financial institutions(including banks, asset managers, pension funds, andinsurers) and FTSE 100 companies to develop andimplement credible transition plans that align with the1.5°C goal of the Paris Agreement. The UKgovernment has consulted on options to take forwardclimate-related transition plan requirements, and weawait the outcome of that consultation.ESG and the Sustainable Economy—19 February 2026 47The United Kingdom is introducing a regulatoryframework for providers of ESG ratings. ESG ratingsproviders will be brought within the FCA's regulatoryperimeter and required to be authorised andsupervised by the FCA (unless specifically exempt).The FCA is currently consulting on the rules that willapply to ESG ratings providers with a focus onensuring the transparency, reliability, andcomparability of ESG ratings. The proposed rulesinclude:▪ Transparency: Minimum disclosure requirementsfor methodologies, data sources, and objectives,so users better understand the ratings, and ratedentities understand how they are assessed.▪ Systems and controls: Requirements for robustarrangements to ensure the integrity of the ratingsprocess, including quality control, data validation,and methodology reviews.▪ Governance: Requirements to maintainoperational responsibility over the ratings process,including any outsourcing, to ensure appropriateoversight and compliance with the regime.▪ Conflicts of interest: Requirements to identify,prevent, manage, and disclose conflicts of interestat the organisational and personnel level, tomaintain the ratings' independence and integrity.▪ Stakeholder engagement: Requirements toprovide rated entities with the opportunity tocorrect factual errors, procedures to allow otherstakeholders to provide feedback, and a faircomplaints-handling procedure.In addition, it is proposed that ESG rating providerswill be subject to certain "baseline standards" underthe FCA rules, including (among others) the FCA'ssenior managers and certification regime. The ESGratings regime is scheduled to take effect on 29 June2028.WHAT IS ON THE HORIZON?Following a review on “climate reporting by assetmanagers, life insurers, and FCA-regulated pensionproviders,” the FCA has announced that it isconsidering how to streamline and enhance theUnited Kingdom's sustainability reporting frameworkby simplifying disclosures, easing unnecessarycompliance burdens, improving the decisionusefulness of reporting, and promoting internationalalignment. Consultations on specific changes areexpected to follow.The FCA previously consulted on extending the SDRto all forms of portfolio management services providedby FCA-authorised firms, including model portfolios,customised portfolios, and bespoke services. Theextension was primarily aimed at wealth managementservices for individuals and model portfolios for retailinvestors. The FCA proposed that firms offeringportfolio management services to professional clientswould be able to opt in to the labelling regime butwould not be subject to the naming and marketingrequirements and associated disclosures. Theproposed scope did not include services where theclients are based overseas or where the client is afund or its manager (i.e., where the portfolio manageracts as a delegate). These changes have, however,been put on hold by the FCA, with no indication of theplanned timescale for finalisation of these rules.CONCLUSIONESG and the Sustainable Economy—19 February 2026 49CONCLUSIONAs reflected above, the global ESG landscape iswidely varied, with jurisdictions addressing ESGmatters in their own ways with their own goals. Thiscan cause challenges for asset managers who seek todeploy asset management services and investmentfunds at scale and consistently around the globe. It isnot possible at this point to develop a single “highestcommon factor” approach applicable to alljurisdictions, as some are imposing labelingrequirements, while others are focusing on disclosure,and only some regions have prescriptive processrequirements with respect to risk identification andproduct integrity. As a result, the global ESGlandscape will remain an area requiring significantcompliance resources for the foreseeable future.Indeed, some asset managers may consider creatingbespoke products to address the regulatory needs ofindividual jurisdictions rather than trying to complywith multiple regulatory regimes.The ESG landscape is also evolving and evolvingquickly. The pace of change alone will create newchallenges for asset managers in relation to theirexisting products, as well as their global products,especially for products that have a global distribution.That said, there are some common themes thatsuggest some practical approaches asset managerscan take to address these differing and evolvingrequirements. Specifically, clear and accuratedisclosure to investors remains of paramountimportance in all jurisdictions. As a result, assetmanagers operating in this fragmented globalenvironment should take extra care to ensure thattheir ESG strategies are clearly described and thattheir portfolio managers are following any ESGprocesses that are communicated to investors. Inaddition, asset managers should ensure that theirmarketing materials do not overstate their ESGfeatures. Not only could such overstatements createregulatory concerns in and of themselves, but suchstatements may also create different regulatoryobligations in some jurisdictions with respect tolabeling, disclosures, or testing.ENDNOTESESG and the Sustainable Economy—19 February 2026 51ENDNOTES1 Please note that individual countries within the European Union may impose additional ESG-relatedrequirements or restrictions. While we touch on some particular considerations for Ireland and Luxembourg, assetmanagers should consider whether the particular EU countries that they perform services in have introduced rulesor guidelines that exceed those that apply to all EU members.2 Scope 1 emissions are “direct” emissions, which a company causes by operating the things that it owns orcontrols. Such emissions can result from operating machinery to make products, driving vehicles, coolingbuildings, or powering computers and other equipment. Scope 2 emissions are “indirect” emissions created by theproduction of the energy bought by a company, such as the fossil fuels generated by a company using purchasedelectricity. Scope 3 emissions are anticipated to be the most common form of emissions for asset managers, asthey are “indirect” emissions from activities upstream or downstream in a company's value chain (e.g., emissionsfrom investments).3 Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 onsustainability-related disclosures in the financial services sector.4 Commission Delegated Regulation (EU) 2022/1288 of 6 April 2022 supplementing Regulation (EU) 2019/2088 ofthe European Parliament and of the Council with regard to regulatory technical standards specifying the details ofthe content and presentation of the information in relation to the principle of do no significant harm, specifying thecontent, methodologies, and presentation of information in relation to sustainability indicators and adversesustainability impacts, and the content and presentation of the information in relation to the promotion ofenvironmental or social characteristics and sustainable investment objectives in precontractual documents, onwebsites, and in periodic reports.5 Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishmentof a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088.6 Information about the process is available at https://www.cssf.lu/en/2021/02/communication-on-the-sfdr-fasttrack-procedure-and-the-deadline-of-10-march-2021/, and (second round)https://www.cssf.lu/en/2022/09/communication-to-the-investment-fund-industry-on-sfdr-rts-confirmation-letter/.GLOSSARYESG and the Sustainable Economy—19 February 2026 53GLOSSARYAcronym DescriptionAASB Australian Accounting Standards BoardAIF Alternative Investment FundAIFM Alternative Investment Fund ManagerAPRA Australian Prudential Regulation AuthorityASA UK Advertising Standards AuthorityASFI Australian Sustainable Finance InstituteASIC Australian Securities and Investments CommissionAUASB Auditing and Assurance Standards BoardCIS Code Code on Collective Investment SchemesCMA UK Competition and Markets AuthorityCMS Capital Markets ServicesCoC Code of Conduct for Providers of ESG Rating and Data ProductsCPS Cross-Industry Prudential StandardCSA Common Supervisory ActionCSDDD Corporate Sustainability Due Diligence DirectiveCSRD Corporate Sustainability Reporting DirectiveCSSF Commission de Surveillance du Secteur Financier (the Luxembourg financial regulator)ERISA Employee Retirement Income Security Act of 1974ESG Environmental, Social, and GovernanceESMA European Securities and Markets AuthorityETF Exchange-Traded FundFCA UK Financial Conduct AuthorityFMP Financial Market ParticipantFSA Financial Services Agency of JapanESG and the Sustainable Economy—19 February 2026 54FSC Financial Services CouncilFSTE Financial Times Stock Exchange 100 IndexFY Financial YearGHG Greenhouse GasHKEX Stock Exchange of Hong Kong LimitedHKFRS Hong Kong Financial Reporting StandardsHKICPA Hong Kong Institute of Certified Public AccountantsHKMA Hong Kong Monetary AuthorityIFRS International Financial Reporting StandardsISSB International Sustainability Standards BoardMAS Monetary Authority of SingaporeMiFID Markets in Financial Instruments DirectiveMPF Mandatory Provident FundMPFA Mandatory Provident Fund Schemes AuthorityNZAM Net Zero Asset ManagersPAE Publicly Accountable EntityPAI Principal Adverse ImpactRAIF Reserved Alternative Investment FundRSE Registerable Superannuation EntityRTS Regulatory Technical StandardsSDR Sustainability Disclosure RequirementsSEC Securities and Exchange CommissionSFA Securities and Futures Act 2001SFC Hong Kong Securities and Futures CommissionSFDR Sustainable Finance Disclosure RegulationSGX Singapore ExchangeSME Small- and Medium-sized EnterprisesESG and the Sustainable Economy—19 February 2026 55SPS Superannuation Prudential StandardSRS Sustainability Reporting StandardsSTI Straits Time IndexTCFD Task Force on Climate-related Financial DisclosuresTSC Technical Screening CriteriaUCI Ultimate Controlling Institutional UnitUCITS Undertakings for the Collective Investment in Transferable SecuritiesVCoC Voluntary Code of ConductEDITORS AND AUTHORSESG and the Sustainable Economy—19 February 2026 57EDITORSLance C. [email protected] E. RiemerOf CounselNew [email protected] M. BennettPartner and Director of K&L Gates Straits Law [email protected] BowenManaging Partner, Dublin [email protected] BullingOf [email protected] ChanAssociateHong [email protected] [email protected] L. JoseSenior [email protected] and the Sustainable Economy—19 February 2026 58Zainab [email protected] LamAssociateHong [email protected] LautierPartnerSydney+61.2.9513.2570lisa.lautier@klgates.comAndrew J. [email protected] M. PaschalidisSenior AssociateLuxembourg+352.285.652.205adam.paschalidis@klgates.comDr. Philipp RiedlPartnerMunich+49.89.321.215.335philipp.riedl@klgates.comYuki SakoOf CounselWashington, DC, [email protected] Young YeuOf CounselHong [email protected]&L Gates is a fully integrated global law firm. For more information about K&L Gates or its locations, practices,and registrations, visit www.klgates.com.This publication is for informational purposes and does not contain or convey legal advice. The information herein should not be used orrelied upon in regard to any particular facts or circumstances without first consulting a lawyer.©2026 K&L Gates LLP. All Rights Reserved. REQ9349

K&L Gates LLP - Lance C. Dial, Keri E. Riemer, Edward Bennett, Gayle Bowen, Jim Bulling, Anson Chan, Michelle Huo, Anu L. Jose, Zainab Kuku, Alvin Lam, Lisa Lautier, Andrew Massey, Adam M. Paschalidis, Philipp Riedl, Yuki Sako and Sook Young Yeu

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Global Survey of ESG Regulations for Asset Managers: ESG and the Sustainable Economy Handbook

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