The Brief:
ASIC is suing Fiducian for allegedly misleading investors over an ESG fund marketed as socially responsible.
It’s ASIC’s fourth greenwashing action and the first against a responsible entity for governance failures.
ASIC is back on its greenwashing grind, launching civil penalty proceedings against Fiducian Investment Management Services Limited (Fiducian).
The regulator alleges that the fund manager breached its duties and misled investors about how its Diversified Social Aspirations Fund worked.
The fund, launched in 2015 and closed in 2024, was marketed as a “socially responsible” investment option, promising to invest in companies that “aim to be positive for society and the environment” and to avoid harmful industries.
But ASIC says the fund did exactly the opposite.
Fiducian’s own records show the fund held shares in BHP, Rio Tinto, Woodside Petroleum, Newcrest Mining and Orica.
The regulator also claims Fiducian misled investors by saying it would monitor the portfolio exposure and investment styles of its underlying fund managers when, in reality, it lacked the information or systems to do so.
Deputy Chair Sarah Court said the case shows “how not to run an ESG fund,” accusing Fiducian of attracting investors with unverified claims and reissuing the same misleading PDS for nine years despite knowing the fund’s holdings contradicted it.
Entities can’t “capitalise on investors’ interest in ESG investments without ensuring their sustainability-related representations are well-founded, transparent and consistent,” Court said.
ASIC is seeking declarations, penalties and adverse publicity orders.
It’s the fourth greenwashing case following earlier actions against Mercer Super, Vanguard and Active Super. And it’s the first case to test responsible entity duties in an ESG context.