The regulatory tide begins to rise against greenwashing - 'ASIC v Vanguard investments'

Earlier this year, the Australian Securities and Investments Commission (ASIC) was successful in the first set of civil penalty proceedings for greenwashing to achieve a court outcome, in 'Australian Securities and Investments Commission v Vanguard Investments Australia Ltd'. In this case the Federal Court found that Vanguard Investments had breached sections 12DB(1)(a) and (e) and 12DF(1) of the 'Australian Securities and Investments Commission Act 2001' (Cth) due to misleading claims that it made about certain environmental, social and governance (ESG) exclusionary screens applied to investments in an index fund. The decision in 'ASIC v Vanguard Investments' is important, not simply because it represents a “win” for ASIC in its first court outcome in greenwashing proceedings, but because it also confirms that general principles relating to misleading and deceptive conduct apply to greenwashing claims.