Disclosure and Reporting Guidelines for ESG Funds — FSC Mauritius
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These are FSC guidelines, not a statute or regulation. They apply to authorised collective investment schemes and closed-end funds whose key investment focus is ESG, meaning at least two-thirds of net asset value is ESG-focused (para. 2.1). Such an "ESG Scheme" registers with the FSC, discloses its ESG method in the offering document and reports on it every year with independent certification. Only an ESG Scheme may use ESG terms in its name.
Scope and the core mechanism
The test is quantitative. ESG factors must significantly influence asset selection, with at least two-thirds of NAV ESG-focused (para. 2.1). Sub-funds of Variable Capital Companies are included. Negative screening alone, or merely incorporating or integrating ESG considerations to seek financial returns, does not establish an ESG investment focus (footnote 4). ESG factors include those aligned with one or more ESG criteria forming part of the UN Sustainable Development Goals or other widely accepted goals (para. 2.3).
The FSC frames the guidelines against IOSCO's November 2021 recommendations on sustainability in asset management (para. 1.3). It states that they align with Recommendation 2 (para. 1.9). For the meaning of ESG, they reproduce the UN PRI Reporting Framework definition (para. 1.7). Paragraph 1.8 allows definitions from other recognised frameworks.
In practice: the two-thirds test is continuous, not a launch check. If a scheme drops below it, it has 90 days to bring the portfolio back into line (para. 2.2). The annual Sustainability Report must also explain any failure to meet the requirement (para. 6.2.1(e)).
Key provisions
| Provision | What it says | The practical point |
|---|---|---|
| Fund name (paras 5.1 and 5.2). | An ESG Scheme's name must be appropriate and not misleading. No other scheme or closed-end fund may use "Environment", "Social", "ESG", "Green", "Sustainability" or similar terms. | The naming bar applies to schemes outside the regime. A fund that is not registered as an ESG Scheme cannot carry those words in its name. |
| Register (para. 3.1). | Paragraph 3.1 provides for a register of all ESG Schemes, accessible on the FSC website. | A scheme that can no longer meet the guidelines is removed from the register (para. 7.3). |
| Offering document (para. 6.1). | Five headings: investment objective, strategy and its binding elements, asset allocation, any reference benchmark, and ESG-specific risks. | The allocation section states the share of NAV used for the ESG objective and how the rest is invested. The remainder must not compromise the ESG focus (footnote 5). |
| Sustainability Report (para. 6.2.1). | Filed annually with the FSC and sent to investors. It covers how far the ESG focus was met, with a comparison to the previous period if any, the actual proportion of qualifying assets and any benchmark comparison. | It also discloses actions taken to attain the ESG focus, relevant method changes and an explanation of any failure to meet the two-thirds requirement. |
| Website (para. 6.3.1). | Where the scheme has a website, it discloses how the ESG focus is measured and monitored, its due diligence, engagement and proxy-voting policies, and ESG data sources. | Where data is missing, the website must describe the assumptions used in its place. |
| Monitoring and exit (paras 7.1 to 7.4). | The governing body or CIS manager monitors the portfolio against the stated focus. A scheme dropping its ESG focus notifies investors and the FSC as soon as reasonably practicable. | The FSC may take regulatory action where a scheme fails its stated objective or strategy (para. 7.4). |
| Certification (para. 9). | A new application, or an existing fund changing its objective to pursue an ESG focus, needs an independent third-party certification or a self-certification. It confirms that the objective and strategy in the offer document align with the UN SDGs or other widely accepted goals. | Self-certification is also open to existing schemes registering under the transitional provision (para. 12.2). The Sustainability Report always needs independent third-party certification (para. 9.2.1). |
| Certifier (para. 10.1). | An auditor registered with the Financial Reporting Council, a credit rating agency licensed or recognised by the FSC, or another provider the FSC approves. | Each must have relevant and sufficient ESG expertise. |
| Continuation (para. 4). | A foreign scheme authorised by the FSC as a CIS or closed-end fund may register as an ESG Scheme by way of continuation. | It then follows these guidelines, the FSC Rules and Mauritian law (para. 4.2). |
Amendment history
| Date | Instrument | What changed |
|---|---|---|
| 10 Mar 2025 | Disclosure and Reporting Guidelines for ESG Funds. | Issued under section 7(1)(a) of the Financial Services Act. |
| 24 Mar 2025 | Same guidelines, para. 11.1. | Effective date. New applications filed on or after it need the para. 9.1.1 certification. |
| 1 Aug 2025 | Same guidelines, para. 12.1. | Deadline for an existing authorised scheme that qualifies as an ESG Scheme to apply for registration with revised offering documents and a para. 12.2 certification. |
Paragraph 1.11 states that the FSC may review and amend the guidelines from time to time.
What it works with
The guidelines sit on top of the product rules in the Mauritius CIS and Closed-end Funds Regulations 2008. Those Regulations govern authorisation, the offering document and reporting. Unless otherwise specified, terms in the guidelines have the meanings given in the relevant Acts (para. 1.10).
Two EU instruments are useful comparators. The SFDR sets pre-contractual disclosure for funds promoting environmental or social characteristics or with a sustainable investment objective (Arts 8 and 9). Art. 11 adds periodic reporting. The templates sit in Annexes IV and V of Delegated Regulation (EU) 2022/1288, covered in the SFDR periodic reporting guide.
The ESMA fund-names guidelines apply to EU UCITS management companies and AIFMs (para. 1). Funds with ESG or sustainability terms in their names should meet an 80% threshold. It counts investments used to meet environmental or social characteristics or sustainable investment objectives (paras 16 to 18). Mauritius measures two-thirds of NAV instead. For the UK, see the summary of the FCA's ESG sourcebook.
In practice: where both sets of guidelines apply to a range, their investment and naming tests are assessed separately. Whether ESMA's guidelines apply at all depends on the manager's EU status. Paragraph 5.2 reserves ESG terms to registered ESG Schemes, so a scheme removed from the register under paragraph 7.3 no longer meets the condition for an ESG name.
To verify
- Which authorised funds are caught: whether "authorised Collective Investment Schemes and Closed-end Funds" in para. 2.1 includes expert funds and professional CIS under the 2008 Regulations, per FSC guidance.
- Report timing: whether the FSC has set a form or a filing deadline for the annual Sustainability Report under para. 6.2.1.
- Register location: where on the FSC website the ESG Scheme register required by para. 3.1 is published.
- Approved certifiers: whether the FSC has published a list of other providers approved under para. 10.1(c).
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