Guidance on ESG Funds and Model Portfolios in ADGM

(VER01.141124)

TABLE OF CONTENTS

1. SCOPE AND PURPOSE OF THIS GUIDANCE

Scope

1.1 This Guidance applies to:

(a) Domestic Funds; (b) Model Portfolios; and (c) Foreign Funds,

which choose to hold themselves out as having environmental, social and/or governance (“ESG”) characteristics, collectively, referred to as “ESG Investment Vehicles” in this Guidance.

1.2 The general principles set out in this Guidance are also applicable to other Authorised Persons that provide financial services or raise investor funds while purporting to have ESG characteristics.

Purpose

1.3 The purpose of this Guidance is to:

(a) clarify the expectations of the Financial Services Regulatory Authority (“FSRA”) for the management and marketing of ESG Investment Vehicles; (b) mitigate the risk of greenwashing, as described below, such that ESG Investment Vehicles are marketed in a manner that is clear, fair and not misleading; and (c) encourage disclosure of ESG-related information by ESG Investment Vehicles in line with global best practices.

1.4 This G...