On the 6th of April 2025, the rules changed, and many asset managers haven’t caught up.

Thanks to the UK’s Digital Markets, Competition and Consumers Act, the Competition and Markets Authority (CMA) now has the power to fine companies up to 10% of their global turnover for misleading consumers. No court order required. No long legal battle. Just evidence that you broke the rules.

And if you think this doesn’t apply to you, think again. The new law covers any product or service marketed to UK consumers, including investment funds. If you’re making claims like “sustainable”, “green”, “net zero aligned”, or “ESG friendly” in your materials, you’re liable.

This isn’t just a PR risk anymore. It’s a legal one.

What Asset Managers Are Getting Wrong

The biggest issue is that too many asset managers still treat greenwashing as a reputational inconvenience, not a compliance failure.

Let’s be clear:

• Vague ESG claims with no supporting data are now a regulatory red flag.

• Cherry-picking ESG success stories while ignoring portfolio-wide exposure is misleading by omission.

• And yes, marketing funds as “aligned” or “sustainable” without evidence breaches consumer protection law.

The bar for consumer claims has risen, and most firms will struggle to meet it if they continue the way they’ve been operating. In the eyes of the regulator, if a UK consumer is misled into buying a financial product, that’s a breach, and ESG fund labels, ESG web pages, ESG-themed product names: they all count.

The CMA doesn’t need to prove intention. Just that the impression was misleading and the data didn’t back it up.

Why This Time Is Different

We’ve seen greenwashing guidance before, but this is the first time UK regulators can issue direct financial penalties without going through the courts, which changes everything.

Before, regulators could issue warnings or go through drawn-out court cases. Now, they can act fast, hit hard, and make examples of firms that don’t comply.

The law doesn’t only apply to traditional “green” products either. Any ESG-leaning pitch, whether it’s SFDR Article 8, Net Zero aligned, or “ethical” investing, needs to be backed up with current, defensible data. And UK regulators don’t just look at internal documents, they look at what you say on your website, in factsheets, and across your public-facing materials.

The risk isn’t hypothetical anymore. It’s built into your marketing.

How GaiaLens Helps You Avoid the Fine Print (and the Fines)

At GaiaLens, we’ve seen this coming for a while, and we’ve built tools to help firms stay clean.

Here’s how we can help you avoid landing on the CMA’s radar:

• Our greenwashing score flags where portfolio companies' behaviour doesn't match their ESG claims, so you can stop repeating them blindly.

• Daily ESG data across 22,000+ companies ensures you're not relying on out-of-date, stale inputs when you make consumer-facing statements.

• Automated alignment tools help you back up SFDR, Net Zero, and EU Taxonomy claims with real, traceable metrics.

• AI-powered insight extraction lets you see exactly how companies describe themselves vs what their data says, exposing the gaps before regulators do.

The goal is to allow you zero guesswork. Just defensible, up-to-date, and consistent ESG disclosures, the kind that withstand scrutiny.

Don’t Wait for the First Fine

The CMA now has the power, and the pressure, to act. Greenwashing isn’t a soft target anymore. It’s high-profile, politically charged, and sitting at the top of the UK enforcement agenda.

If your firm is still relying on fluffy ESG narratives and generic PDFs to sell its sustainability story, it’s time to rethink. Because next time it might not be a warning. It might be 10% of global turnover.

Ready to stress-test your claims?

Try GaiaLens for free and see how your ESG data stacks up, before the CMA does.

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