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Regulatory Update

Clearing the Haze: Understanding the FCA's New Greenwashing Rules

Jennifer Bocchicchia | May 31, 2024

New Guidance Document Will Help Companies Avoid Greenwashing and Substantiate Sustainability Claims

The U.K. Financial Conduct Authority (FCA) published its final guidance for an anti-greenwashing rule as part of its Policy Statement on Sustainability Disclosure Requirements (SDR) and investment labels (PS23.16), marking a significant step to curtail misleading sustainability-related claims. The rule, which takes effect on May 31, 2024, is a part of the FCA’s broader sustainability agenda and comes at a time when consumer demand for sustainable products and services is at an all-time high.

By tackling greenwashing, the FCA aims to improve consumer confidence and trust, enhance market transparency and facilitate the flow of capital into products that can drive positive environmental change.


The rule applies to FCA-authorized firms that communicate with clients in the U.K. in relation to a product or services or promotion of a financial product.


The FCA’s anti-greenwashing rule is part of a package of measures introduced through the Sustainability Disclosure Requirements (SDR) and investment labels regime. These measures are expected to reinforce the integrity of sustainability claims and support informed decision-making by consumers aligned with their sustainability preferences.

The anti-greenwashing rule is designed to protect consumers from the risks associated with greenwashing. The guidance defines greenwashing as the practice of making misleading exaggerated or false claims about the environmental benefits of a product, service, or company to appeal to environmentally conscious consumers and investors. The rule is built upon the foundation of the ‘4 Cs’, which states that claims must be:

  • Correct– capable of substantiation and factually correct;
  • Clear – understandable and contains accurate information;
  • Comparable –comparisons to a product or service, to a previous version or that of a competitor, should be fair and meaningful; and
  • Complete – firms should not omit or hide important information.

These principles ensure that firms provide information that is accurate, easy to understand, and comprehensive, covering the full lifecycle of the product or service without omitting crucial details that could influence consumer decision-making.

The FCA guidance outlines the expectations for firms and provides clarity on the scope and application of the rule. It emphasizes the importance of substantiating any sustainability claims with evidence and ensuring that these claims are consistent with the actual sustainability characteristics of the product or service. The FCA has also introduced examples of good practice within the guidance to help firms understand how to comply with the rule effectively.

Next Steps

As the deadline for the rule’s implementation approaches, firms are advised to review their sustainability-related claims and marketing materials to ensure compliance with the new requirements. This involves reviewing and potentially revising their marketing materials, training staff and implementing robust processes to substantiate sustainability claims.

The FCA suggests that firms consider making the evidence supporting their claims public, although this is not a mandatory requirement. The FCA’s guidance serves as a valuable resource for firms to understand and adhere to the anti-greenwashing rule, ultimately fostering a more transparent and trustworthy financial market.

For more detailed information on the FCA’s anti-greenwashing rule and guidance, you can refer to the official documents provided by the FCA: FCA Handbook – Guidance on the Anti-Greenwashing Rule

TRC Can Help

TRC has a seasoned team of industry experts who can provide strategic advice and assistance to your organization in navigating sustainability-related compliance readiness. If you would like to learn more about TRC’s services relevant to the FCA’s Greenwashing Rule, please contact our expert below.

Jennifer Bocchicchia

Jennifer Bocchicchia is an ESG consultant at TRC who analyzes and develops strategies to improve sustainability, while adhering to stringent regulatory standards. Jennifer’s understanding of both environmentally responsible practices and regulations allows her to integrate sustainable practices with regulatory compliance to foster both environmental stewardship and consumer trust in a clear and concise format. Contact her at

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