All financial advisers are required to comply with the Financial Adviser Standards and Ethics Authority (FASEA) Code of Ethics Standard.
The Code’s standards require advisers to act in the best interests of their clients, which means that product recommendations must be appropriate to meet the client’s objectives, and consider the client’s broader, long-term interests. This includes any social or ethical preferences the client might have.
The Financial Planning Association (FPA) guidelines on the FASEA Code of Ethics states: “Financial advisers should ask their clients if there are any environmental, social or ethical considerations that are important to them”.
For an adviser to then take account of their client’s preferences, they need to be able to understand what a fund manager’s portfolio looks like. That goes well beyond a view on ESG process.