The Financial Services Council (FSC) has set out guidance for fund managers to ensure they are acting on climate change risk.
The guidance covered how fund managers could set industry expectations on net zero targets especially assessing emissions, labelling investment products to avoid climate greenwashing and fulfilling their legal obligations to disclose climate-related risks.
FSC chief executive, Blake Briggs, said: “The Australian funds management industry takes the challenge of climate change seriously, along with its role in allocating capital to facilitate the transition to a low carbon economy.
“The Glasgow Financial Alliance for Net Zero estimates $4.5 trillion USD a year from 2026 is required to transition the global economy to net zero by 2050.
“Investment funds are playing a vital role in this economic transition by working with their portfolio companies to adopt lower emissions practices.”
He said the FSC’s guidance was a “signal to Government, regulators and consumers” that the Australian investment community was making climate change risk a top priority for them.