Published on Jul 19th, 2022 |

5 Common ESG Deficiencies Found From SEC Examinations

Vigilant has seen 5 common ESG Deficiencies found during SEC examinations below:

  1. Failure to address the review of ESG language (e.g., descriptions of ESG criteria or focus of the fund’s investment strategy) in marketing materials to ensure consistency with regulatory filings for fund clients with ESG factors or principles as part of their investment strategies.
  2. Failure to maintain an adequate ESG investment due diligence process and metrics, with effective oversight by the sub-adviser’s CCO to ensure ESG compliance.
  3. Failure to maintain adequate proxy voting practices.
  4. Failure to review quarterly meeting materials for fund clients with ESG factors or principles as part of their investment strategies, to ensure accuracy of applicable ESG factors, principles, and descriptions.
  5. Failure to maintain policies and procedures surrounding ESG Investing.

If you are in need of assistance in reviewing, updating, or maintaining your Firm’s policies and procedures, contact us.

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