SA regulator targets greenwashing

South Africa’s financial watchdog is moving to police greenwashing more aggressively, with new rules planned for sustainability claims in ads and climate disclosures. (currencynews.co.za) The regulator is the Financial Sector Conduct Authority, or FSCA, which oversees how banks, insurers, investment schemes and other financial firms treat customers and present products. Its 2026 sustainable finance update says tougher guardrails are coming for sustainability-related marketing and disclosure. (fsca.co.za) (moonstone.co.za) In plain terms, greenwashing is when a firm sells a product as “green” or “sustainable” without evidence strong enough to support the claim. The FSCA said weak claims can mislead consumers, distort market signals and steer money away from genuinely sustainable activities. (currencynews.co.za) (moonstone.co.za) The immediate focus is advertising and marketing. The FSCA said its guidance will cover sustainability-related claims made about financial products and services in the retail market and will be designed to work alongside existing disclosure rules, not replace them. (currencynews.co.za) The push also reaches company reporting. South Africa is edging toward more uniform sustainability disclosure, with the Johannesburg Stock Exchange reviewing its guidance to align with the International Sustainability Standards Board’s IFRS S1 and IFRS S2 standards. (group.jse.co.za) (moonstone.co.za) Those two standards set a common template: IFRS S1 covers general sustainability risks and opportunities, while IFRS S2 focuses on climate. Companies using them are expected to explain governance, strategy, risk management, and the metrics and targets they use. (moonstone.co.za) The FSCA has been building toward this since 2023 through a broader sustainable finance programme covering taxonomy, disclosure, market development, active ownership and consumer education. Its 2026 report says the work is meant to align South Africa’s financial sector with global standards and the country’s climate commitments. (moonstone.co.za) Consumer demand is part of the backdrop. Currency News reported that an FSCA survey in March 2025 found 84.7% of consumers expect financial institutions to consider environmental and social impacts in investment decisions. (currencynews.co.za) South African regulators have already been tightening disclosure rules in adjacent areas. In 2020, the FSCA published a draft conduct standard for collective investment schemes that set requirements for advertising, marketing and information disclosure to investors. (fsca.co.za) The next step is less about banning the word “sustainable” than forcing firms to prove what they mean when they use it. The FSCA’s own test is straightforward: customer information must be clear, factually correct, not misleading and written in plain language. (currencynews.co.za)