UK Hedge Funds Expect ESG Cash Boost
Local regulators are signaling they may break away from the EU in their treatment of short-selling.
Hedge funds based in the UK may soon be handed a competitive edge over their peers in the EU, when it comes to ESG investing.
Britain, unlike the EU, has signaled it’s willing to enshrine the role that short-selling plays in environmental, social and governance investing in the foundations of its ESG rulebook. The Financial Conduct Authority has “explicitly sought feedback on the role of derivatives, short-selling and securities lending in sustainable investing” because “we need to ensure that our regulatory framework is appropriately designed to accommodate the breadth of ESG strategies observed in the market,” the UK regulator told Bloomberg in an email.