Globally, there is growing recognition of the need for clear disclosure requirements for investment instruments carrying sustainable or impact labels. These labels serve as an important part of the investment proposition, offering clients greater confidence in their ability to allocate capital toward meaningful impact.
For investors seeking to achieve both financial and impact outcomes, transparent and reliable disclosures are essential. A fund identified as an impact fund should meet well-defined, necessary, and sufficient conditions to ensure credibility. Establishing such conditions within a regulatory framework helps maintain appropriate market conduct while serving the best interests of investors.
Impact investments often have unique characteristics, such as being unlisted or illiquid and require specific reporting and measurement standards to track both financial and impact outcomes. As global sustainable finance and impact disclosure frameworks continue to develop, regulators have the opportunity to incorporate best practices that define and support these instruments. In some cases, this may require tailored regulatory approaches that account for the distinct nature of illiquid assets and ensure appropriate measurement and disclosure requirements.
This white paper explores how regulation can contribute to the development of clear and credible impact investment instruments that align with global best practices.
