1、The crackdown on greenwashingWhy it matters and managing your organizations riskKPMG International As more products are being labeled“green”or“sustainable,”there has been a rise in exaggerated,misleading or unsubstantiated claims and financial services regulators are taking notice.In the UK,the Fina

2、ncial Conduct Authority(FCA)has given a clear signal that it plans to clamp down on greenwashing.1 Other stakeholders are also watching.Its a given that organizations should not be greenwashing.Consumers need to understand what theyre buying and be able to trust that products have the sustainable ch

3、aracteristics they claim to.Regulators have a clear mandate to build trust in financial markets.But more than this,trust is imperative to sustainability and the environmental,social and governance(ESG)agenda.Engaging in greenwashing can erode trust and make it difficult or impossible for consumers t

4、o take an organizations ESG messages at face value.There have always been regulatory and legal requirements to not mislead or misrepresent a product or services credentials.But the ESG agenda has ushered in an era of hyper-transparency and invites scrutiny from a significantly wider spectrum of stak

5、eholders.The fines courts around the world are imposing for greenwashing are starting to mount,but we believe this is just the beginning.The commercial and reputational damage that comes with being accused of greenwashing,or being perceived as greenwashing,is usually a much greater cost.In the past

6、year,KPMG professionals have come together to support clients in identifying where risks may lie and the steps they can take to help mitigate them.This paper details what we have learned,shares examples of organizations that have been challenged on what they sell and what they do,and includes six st