Argentina’s National Securities Commission (CNV) recently approved a special regime for the placement of funds earmarked for environmental and social projects or activities, according to its sustainable investment guidelines and under the standards of the United Nations Development Programme (UNDP).

With the aim of raising awareness among capital market actors on how to integrate environmental, social and governance (ESG) factors into investments, and also to generate structures that advance towards sustainable financing in the country, the new regime is part of the regulator’s Sustainable Finance Programme. General Resolution RG 885/2021 provides a specific regulation for open and closed Mutual Funds (FCI) and Financial Trusts (FF), considering proposals and opinions from different sectors received through a public consultation made available by the agency.

The name Open ESG ICFs was adopted in terms of environmental, social and governance impact, while the assets eligible for their formation include marketable securities listed on market panels that stand out for applying good Corporate, Social and Environmental Governance practices. The initiative increased the limit on the percentage of investment in quotas of closed-end ICFs, including the possibility of incorporating information on ESG objectives. It was added as a requirement for the establishment of Sustainable Collective Investment Products, to demonstrate experience in applying for listing in a market with green, social and sustainable segments and/or trading panels.
The new tool is the result of the CNV’s policy to promote an active articulation between the public and private sectors and to encourage the sector to contribute to the debate to define a medium and long-term plan on how to address sustainable financing and green investment in the country.