Britain’s Financial Conduct Authority (FCA) is to consult with outside experts to clamp down on greenwashing or exaggerated environment, social and governance (ESG) claims.
The UK has become the first major economy to require that companies disclose their climate change policies on a "comply or explain" basis, in an effort to provide investors with better and more comparable information.
In November, the FCA outlined proposals to classify related investment products following the introduction of European regulation around sustainable finance disclosures.
As part of efforts to help Britain achieve a net zero economy by 2050, the FCA has also established a new ESG Advisory Committee.
Interested ESG experts are invited to apply by September 16, with the first meeting scheduled for the fourth quarter.
"We do not expect people currently employed by FCA regulated firms to be appointable to the committee," the watchdog said in a statement.
Paul Crighton, partner at UK law firm TLT said the association of firms regulated by the FCA with regard to ESG issues needs to be clarified and standardised.
"The creation of an ESG Advisory Committee to the FCA could be a welcome opportunity to make sure any new rules are ambitious enough and practical, so that they do ultimately work in practice and make a difference," Crighton said, reports Reuters.