EU watchdog cracks down on 'greenwashing' investment funds           

Regulators concerned over funds making sustainability claims which are exaggerated or unverified

ESMA has published a consultation paper which proposes two criteria for using 'ESG' and 'sustainability' in a fund's title.

The European Union's securities watchdog has proposed strict curbs on how investment funds are sold if they tout environmental, social and governance, or ESG, credentials to attract cash.

ESG funds have grown in popularity in recent years and in the second quarter of this year accounted for 27% of share assets under management in funds across the EU, according to figures from the European Securities and Markets Authority (ESMA).