EU Regulators Take Different Enforcement Paths For ESMA ESG Fund Name Guidelines

European regulators have taken different routes as to how they plan to enforce the European Securities and Markets Authority's ("ESMA") guidelines (the "Guidelines") with respect to the use of sustainability‑related terms in fund names. The deadline to implement these changes for existing funds is by 21 May 2025 and has applied to new funds in scope from 21 November 2024.

The Guidelines set out minimum exclusionary criteria for funds with sustainability‑related terms in their names as well as requiring minimum asset allocation levels in line with the environmental and/or social characteristics promoted or sustainable investment objectives. For further information on the Guidelines themselves, please see our alert here.