RIAA has long advocated for the Government to develop a robust and credible sustainable investment product labelling regime in Australia. We warmly welcome this consultation as a step toward enhancing transparency, building trust, and protecting consumers in the responsible investment market.

In the absence of a legislated framework, RIAA established the Responsible Investment Certification Program  two decades ago with the aim of improving the products which are offered to consumers and retail investors and raising industry standards. As at August 2025, over 350 financial products are certified under this program. As Australasia’s leading expert and standard-setter on sustainable financial product labelling, RIAA brings over 25 years of expertise to this consultation.

RIAA believes that a well-designed labelling regime can play a critical role in preventing greenwashing and guiding capital toward sustainable outcomes. To be effective, the regime must be:

• principles-based, with the RIAA’s ResponsibleInvestment (RI) Standard—including its supporting guidance—as the foundation of the labelling regime;
• anchored in widely accepted industry standards; and
• developed in close collaboration with industry stakeholders.

The regime must also be fit-for-purpose for the Australian market, set a clear minimum standard to avoid greenwashing, and be ready for industry adoption from day one to meet growing consumer demand. This can be achieved by the endorsement of the RI Standard which is well-established, industry-accepted, and rigorous.

RIAA’s response has been informed by the input of RIAA members – we are grateful for the strong engagement from our membership and thank those RIAA members who contributed to the development of this submission.

Summary of recommendations

1. Adopt a principles-based labelling regime – The legislative framework should adopt a principles-based approach by endorsing RIAA’s Responsible Investment Standard—including its supporting guidance—as the foundation for sustainable investment product labelling. This standard is well-established, industry-accepted, and rigorous.
2.  Encourage optional third-party verification through certification – Verification should be strongly encouraged for products making explicit sustainability claims. Should the government choose to go down the path of mandatory certification, RIAA is in the best position to provide this with appropriate government/regulator involvement and oversight, as RIAA’s Certification Program has undertaken this role for 19 years.
3. Require specific disclosure for non-financial objectives – Where products include non-financial objectives—such as sustainability claims—specific disclosure obligations should apply.
4. Distinguish labelling from classification frameworks – Labelling and classifications are different and perform separate functions in the market. Care should be taken to ensure the correct term is being used for the intended purpose.
5. Avoid prescriptive product categorisation– The framework should not require all financial products with sustainability objectives to fit into a single classification. Given that the policy objectives of this regime in Australia do not include capital allocation to specific sectors—as seen in some overseas regimes—such a requirement would be misaligned and likely restrictive.
6. Ensure strategic interoperability with international regimes – Interoperability should be guided by principles and strategic alignment, rather than rigid or prescriptive requirements
7. Avoid ranking or prescribing responsible investment approaches – Responsible investment strategies are diverse, often used in combination, and tailored to product structure, asset class, market, and investor needs. The framework should reflect this complexity, avoiding hierarchical treatment and supporting informed investor choice for aligned sustainability objectives, in line with industry norms.
8. Support transparency through clear definitions and disclosure– Use a consumer-focused disclosure framework that fosters transparency and enables retail investors to assess a product against their own values and sustainability goals.
9. Ensure broad applicability across product types –The framework should be inclusive of all investment product categories and must clearly differentiate between impact investing and philanthropy, while upholding fiduciary responsibilities across all product types.
10. Support broader sustainability objectives – The labelling regime should address the full spectrum of sustainability, incorporating social and governance considerations alongside climate-related goals.
11. Establish robust evidentiary requirements – The framework should be underpinned by strong evidentiary standards. A principles-based approach, complemented by targeted prescriptive elements, is recommended. In the short term, evidentiary requirements remain independent of the taxonomy, while continuing to support its voluntary adoption and the development of product-specific use cases.

General submissions

Distinction between ‘labelling’ and ‘classifications’ is important for effective policy

Information and transparency are vital for informed consumers, quality products and strong market integrity. To assist with comprehension and application, there are different ways of organising this information. For sustainable finance, there are four key concepts when it comes to information about financial products:

• Product labelling or naming regimes
• Product classification systems
• Product disclosure requirements
• Taxonomies

These concepts can be interdependent and reinforce each other, for example:

• Product disclosure enables transparency about taxonomy alignment, product classification, and product labelling.
• Taxonomies are one of the tools that can be used to underpin sustainability objectives and claims within a product’s classification and/or labels.
• Product labelling and product classification help consumers and investors navigate the market confidently.

Together, provided they are credible, they create a coherent framework that supports sustainable investment, regulatory oversight, and market integrity.

RIAA has developed a resource – Information about responsible investment products – explaining the different mechanisms through which important information about sustainable finance is shared. It differentiates these terms to ensure clarity when evaluating and recommending regulatory and policy developments.  

Regime must be fit-for-purpose for Australia’s financial markets and retail investors

Australia’s financial system, and thus consumers and retail investors, have unique characteristics.

To effectively achieve consumer-focused policy objectives, the labelling regime must be practical and applicable across all financial services sectors. For Australia, this includes:

• Retail Investor Access: The regime should accommodate both direct retail investment and investment made through financial advice channels and all retail client platform channels, ensuring clarity and consistency for all retail participants (i.e. both direct and indirect, with and without advice). This includes standardising the criteria for relevant sustainability-labelled products that can be understood by retail investors.
• Wholesale andInstitutional Investment Relationships: Many financial products accessed by retail investors are built upon financial products created by and for institutional or wholesale investors, adapted in ways that retail investor can access, typically through products like ETFs, pooled funds and, private wealth platforms. Therefore, the labelling regime should also apply to wholesale and institutional sectors to ensure transparency and alignment across the entire investment lifecycle.

In addition, for consumer benefits to be fully realised, the labelling regime must be usable and accessible to the full spectrum of market participants involved in the investment ecosystem. This includes:

• Asset owners and superannuation funds, who are responsible for managing retirement savings on behalf of members (retail investors).
• Asset managers, who design and manage investment products that retail and institutional investors rely on.
• Financial advisers, who operate under strict regulatory oversight and play a critical role in helping retail investors choose products that align with their financial goals and needs.
• Index providers, who contribute to the construction of investment products.
• Investment platforms, which distribute products to investors and are seeing growing demand for responsible investment (RI) options.

Finally, a labelling regime must be applicable for a variety of financial products. InAustralia, multi-asset products are common, particularly in superannuation, and provide a mechanism through which different investment strategies are employed to progress towards one or more objectives.

Without successful implementation, policy objective will not be achieved.

RIAA members have reported to RIAA that they have experienced challenges on implementation of various UK SDR rules that were not evident through the framework itself, but became apparent in the application and interpretation of the framework by the UK’s Financial Conduct Authority (FCA).  This is because the foundational requirement of the UK SDR is that the product has intentionality to seek or produce positive environmental or societal impact. This intention is required to be stated clearly in its sustainability objective which must form part of its investment objective. As a result of this interpretation, the possible products which are able to use a label under the SDR has narrowed to being versions of impact products, reducing the options available to consumers and retail investors.

Long-standing industry standard should be the basis of legislated regime.

Since2005, RIAA’s Certification Symbol has differentiated responsible investment products from the rest of the market, directing investors towards quality products underpinned by reliable, fit for purpose investment processes.

The RIAA Certification Program has acted in the absence of a legislated regime to improve the products which are offered to consumers and retail investors and raise industry standards. For example, the 2024 ASIC v Vanguard judgment highlighted the value of the Certification Program and the certification process: see paragraphs 69-74. Correspondence between Vanguard and the RIAACertification team was relied on to demonstrate that the misconduct in front of the Court had been brought to Vanguard’s attention.

RIAA strongly recommends that the Government endorses the well-established, industry-accepted and rigorous framework within the RIStandard for product labelling, including the constituent guidance, as the basis of the legislative product labelling regime.

RIAA’s recommendation pertains to the Standard’s product labelling requirements. RIAA Certification goes beyond labelling. The Responsible Investment Standard is underpinned by eight requirements that act as the guiding principles of the RI Certification Program. RIAA’s Guidance and Assessment Notes for products and services certification provide detailed insight into how the Responsible Investment Standard is applied in practice.

Despite this, and in recognition of the role verification plays beyond labelling and the need to ensure Government policy is balanced, efficient and effective,RIAA’s recommendation to use the RI Standard as the basis, above, is in relation to the adoption of the Standard’s product labelling requirements.

As at March 2025, RIAA has certified over 350 certified products totalling $193.6b funds under management. 205 of which are available in Australian totalling $94.4b funds under management which already comply with the RI Standard in relation to product labelling, some of which made significant changes to do so.

Product labelling in the RI Standard.

To fulfil the RI Standard’s product labelling requirements, issuers must demonstrate the following for each product they wish to certify:

          P2 Make honest claims and are appropriately labelled:

          are named to accurately reflect the claims pertaining to social, environmental, sustainability and/or
          ethical outcomes or responsible investment approach applied to the product; and

          describe what could be reasonably expected by an investor in terms of the portfolio holdings of the
          product; and

          ensure all claims made about the product are honest and not false or misleading nor include puffery,
          un-substantiations and unqualified predictions.

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          P5e Have relevant and accessible RI disclosures: for products asserting certain sustainability
          outcomes or claims, publish the product’s social, environmental and/or sustainability performance
          against benchmarks, goals or targets, at least annually as well as the methodology for measuring
          the Product’s contribution to social, environmental and/or sustainability outcomes.

RIAA’s Product Labelling Guidance Note provides detailed information on how Certified product providers can demonstrate compliance with the RIStandard.

Along with the Guidance Note, RIAA has published 2Assessment Notes and a Climate Claims Annex, indicative of the continuing lifting of standards and development of norms in responsible investment and financial product labelling.

• Assessment Note P2 – Products trading with ‘impact’ in the label
• Assessment Note P2 – Products trading with ‘sustainable’ in the label

Recommendation: The legislated product labelling regime should use the product labelling criteria of RIAA’s Responsible Investment Standard as the basis for the regime’s product labelling criteria, including composite guidance.

The Certification Program carries industry acceptance and good will, with a significant proportion of sustainable funds on the market already complying, which will ensure rapid adoption and support to allow retail investors to have clarity over their investment products, allowing for informed decision-making.

The RIAA Certification Program engages internationally, closely monitors international trends and keeps up to date with international developments including through RIAA’s active involvement in the Global Sustainable Investment Alliance (GSIA). The Program’s criteria remain relevant and reflect global industry leading practice. The legislated regime must be able to evolve and adapt to market developments and the evolution of global norms.

Download the ‘full submission’ for responses to all consultation questions.