China: New guidelines for green investment call for annual self-assessments

News announced by Ma Jun-led initiative

The Asset Management Association of China and the China Securities Regulatory Commission have issued voluntary guidelines for green investment, the first of its kind for the Chinese asset management industry.

The Green Investment Guidelines aim to “bring much-needed clarity” and addresses information disclosure, applying green standards, governance and priority areas for green investments.

The guidelines emphasise the need for investments in renewable energy, recycling, environmental protection and recommends using engagement with investee companies to improve environmental performance and disclosure.

Asset managers will also be required to submit annual self-assessments of their green investment products to the Association including evaluation of impact.

The news was announced by the Green Finance Leadership Program (GFLP), a platform for the sharing of best practices to “scale up green and sustainable finance”, headquartered at the Center for Finance and Development of Tsinghua University.Both are led by Dr Ma Jun, a former Deutsche Bank executive hailed as the “founder of China’s environmental movement”.

In the release, the GFLP said the Guidelines would carry “semi-mandatory” power due to random assessments of green investment products which will be carried out by the Asset Manager Association of China to verify self-assessment by asset managers.

The GFLP dubbed this “quite remarkable”.

The GFLP announcement appeared to be the sole source of information for the Guidelines, with no updates posted on either the Asset Management Association of China or the China Securities Regulatory Commission websites at the time of publication.

China previously released a green bond taxonomy in 2015, which attracted criticism for including “clean coal” under the category of green projects eligible for proceeds.

According to a spokesperson from the Centre for Finance and Development, an updated taxonomy is due at the end of the year.