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Transition funds set for lift-off despite greenwashing warnings

In the absence of regulation, transition finance is like '50 shades of green', with asset managers coming up with their own varying interpretations

By Kristen McGachey
Hortense Bioy, Morningstar's director of sustainability research, thinks there may be 'some room for greenwashing' in the FCA's sustainable improvers category
Hortense Bioy, Morningstar's director of sustainability research, thinks there may be 'some room for greenwashing' in the FCA's sustainable improvers category Photo: Chris Ratcliffe/Getty Images

Investment funds that help carbon-intensive companies transition to net zero look set to explode in popularity, even if they result in greenwashing.

The Financial Conduct Authority has floated three potential consumer labels for green funds under its Sustainable Disclosure Requirements — sustainable focus, sustainable improvers and sustainable impact.

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