asset managers who claim their funds are environmentally friendly or socially responsible could have to disclose the criteria and data they used to select the companies the chief of securities and exchange commission said wednesday in a videoconference chairman gary gensler told members of the european parliament that the sec is considering whether to require fund managers to disclose more information about the labeling of their environmental social and governance or esg investing products gensler said he has asked sec employees to make recommendations for disclosure requirements calls for public comment are expected to start by year’s end or early 2022 esg investing has exploded in the past few years as investors become more concerned about the impact of companies on the environment their employees and the communities they work with many funds maintain that they screen their investments for such factors despite various scoring systems from different providers however there isn’t an industry standard on how to evaluate esg risks last month the wall street journal reported that deutsche bank ‘s assetmanagement arm dws group had overstated how much it used sustainable investing criteria to manage its assets the sec and federal prosecutors are now investigating the matter tariq fancy blackrock ‘s former global chief investment officer for sustainable investing wrote in an online post last month that fund managers sometimes mislead investors through their marketing messages fancy calls sustainable investing a “dangerous placebo that harms the public interest” noting that fund companies are motivated to promote esgrelated products because they generally charge higher fees esg is becoming such a hot trend even the famous stock picker cathie wood is eyeing the market opportunities a tuesday filing shows that wood’s firm ark investment management is planning to debut a new etf focused on transparency the new transparency etf unlike most of her other etfs that are actively managed with stocks handpicked by a group of domain experts will track an index of 100 stocks determined by their “transparency” scores the scores will consider the company’s adoption of certain transparency standards legal proceedings and reputation according to the filing the index will exclude certain industries including alcohol banking gambling and tobacco chemicals and oil and gas the transparency etf looks a lot like an esg fund under a different name many companies in the transparency 100 index are big tech and consumer stocks commonly seen in other indexbased esg funds such as microsoft msft apple aapl nvidia nvda nike nke and chipotle mexican grill cmg but none of these names would be considered a “disruptive innovation” play that ark has been known for