Government to “drill down” on possible ESG legislation in early 2023
15 August 2022 at 3:55 pm
Federal Minister for Financial Services Stephen Jones tells Pro Bono News greenwashing is “definitely an issue”.
The Federal Minister for Financial Services Stephen Jones says he will investigate whether Environmental, Social and Governance (ESG) definitions need to be legislated “in the new year”.
In an exclusive interview with Pro Bono News, Jones said possible ESG legislation “was not a priority” before the release of the Federal budget in October.
“As the government is moving away from fossil fuels our immediate priorities are economy-wide targets and the October budget,” he said.
“We are going to look at it in the new year; drill down on it next year.”
But Jones said there is definitely work that needs to be done.
“We are looking specifically at funds, at the ‘e’ part of ESG,” Jones said.
“It is something we need to look at.”
The minister said Australia is about five to 10 years behind the rest of the world in regards to ESG regulation.
“A lot of our companies are operating in other countries where they have to comply with [more stringent] ESG related regulations, so they are ahead of the government,” he said.
“More needs to be done so it is the rule and not the exception.”.
In June the Australian Securities and Investments Commission (ASIC) released its Info Sheet 271, detailing how the businesses and financial services institutions can adhere to current ESG related regulations.
But it has also urged the government to legislate, with ASIC senior executive leader, corporations Claire LaBouchardiere reported as saying legislation is “a call for government”.
The EU Sustainable Finance Action Plan represents arguably the most comprehensive set of regulations governing ESG investment and is part of the European Green Deal.
When asked if Australia would follow the EU, Jones said “in most respects the fund managers are well ahead of where the government has been in regards to meeting carbon targets”.
The minister pointed to the Corporations Act, saying there are already some measures in place.
“The regulator has identified it. Whether it needs to be legislated or not will be under investigation as we currently have laws the regulator can use,” he said.
