The Ontario Securities Commission (OSC) has alleged that Purpose Investments, a Canadian asset manager with more than $19 billion in assets under management (AUM), misled investors about the extent of environmental, social and governance (ESG) integration across its funds.
What happened?
The OSC filed enforcement proceedings against Purpose Investments Inc. and CEO Som Seif, alleging misleading sales communications between September 2019 and March 2023 regarding the firm’s use of ESG factors.
Purpose publicly stated that around 75% of its assets were managed with ESG considerations, while internal records suggest the figure was closer to 30–35%.
Regulators allege there was no formal ESG policy or documented procedures for the portfolio management team during much of this period. ESG integration was inconsistent, ad-hoc, and supported by incomplete data until late 2020.
The OSC also claims that sales communications overstated ESG integration compared to fund prospectuses and were designed to improve marketing impact.
Purpose disputes the allegations, noting that no investor harm or prospectus violations are alleged, and arguing that ESG standards and best practices continue to evolve. A tribunal hearing is scheduled for October 6, 2025.
Why this matters (for managers)
This case reflects a wider global trend in greenwashing enforcement. In the past two years:
• Regulators in the United States and Germany have issued high-profile fines for greenwashing by asset managers.
• Authorities in the United Kingdom and Hong Kong have tightened ESG disclosure rules and stepped up scrutiny of sustainability claims.
For asset managers, the implications are clear:
• Regulatory scrutiny has moved from advice to enforcement.
Misstatements in ESG marketing or disclosures can now lead directly to penalties and formal proceedings.
• Gaps between marketing and reality create material risk.
Where claims about ESG integration outpace actual processes, reputational, legal, and compliance risks converge.
• Processes and data must be formal, auditable, and consistent.
Ad-hoc integration or incomplete documentation is no longer sufficient.
• Trust is built on transparency.
Investors and regulators alike expect alignment between fund documentation, marketing materials, and actual practice - underpinned by verifiable data.
Key Takeaways
• Recognise that regulators globally are intensifying oversight - enforcement actions in the US and Germany, alongside heightened scrutiny in the UK and Hong Kong, all point to the same direction of travel.
• Establish formal, documented ESG policies and ensure they align with all external communications.
• Support all ESG claims with transparent, reliable, and auditable data.
• Regularly audit marketing, reporting, and disclosure materials to confirm consistency with internal practice.
How Integrum ESG helps asset managers avoid greenwashing
At Integrum ESG, we provide asset managers with transparent, credible, and auditable ESG data and analytics.
Our Platform helps firms evidence ESG integration, close the gap between marketing claims and real practices, and protect against both regulatory enforcement and reputational risk. With reliable ESG data and advanced intelligence tools, managers can ensure their strategies withstand both investor expectations and regulatory scrutiny.
ESG Intelligence which is fast, transparent and affordable - only on the Integrum Platform.