A Boost To ESG Investing: SEC Introduces New Rules On Sustainable And Responsible Investment Funds

The Securities and Exchange Commission ("SEC") issued Memorandum Circular No. 11, Series of 2022 or the Rules on Sustainable and Responsible Investment Funds (the "Circular"), which took effect on January 3, 2023. The Circular laid out the rules governing Sustainable and Responsible Investment ("SRI") Funds as a recognition to the global trend and continuous growth of SRIs in the recent years. The rules are applicable to newly formed or existing investment companies that seek to qualify or have qualified as SRI Funds, as well as to non-SRI companies that incorporate or seek to include sustainability or environmental, social, and governance ("ESG") factors in its investment objectives and disclose such in their Registration Statements.