The Financial Markets Authority has formally warned the Australian arm of United States-based investment behemoth Vanguard for failing to disclose in New Zealand that an Australian regulator had issued it three infringement notices accusing it of greenwashing.
Vanguard paid fines of A$39,960 ($42,878) because, although it said three of its funds exclude investment in tobacco companies, they did not exclude companies involved in the sale of tobacco products.
The Australian Securities and Investments Commission (ASIC) said enforcement action against greenwashing is a priority. “Greenwashing is not limited to environmental claims but extends to misleading ethical propositions.”Vanguard offers its funds to NZ investors under the Trans-Tasman Mutual Recognition (MRSO) regime which requires Australian financial product providers to file to NZ’s Disclose Register any infringement notices they receive from ASIC.
Vanguard should have filed the required disclosures no later than Nov 18, 2022, but didn’t do so until Feb 2, 55 business days after ASIC issued the infringement notices.
”The FMA [Financial Markets Authority] is satisfied that Vanguard has materially failed to meet its obligations” under the Financial Markets Conduct Regulations, the NZ regulator said.