Goldman Sachs to Pay $4 Million to Settle Investigation Over ESG Funds – WSJ

WASHINGTON—Goldman Sachs Group Inc.’s asset-management arm agreed Tuesday to pay $4 million to settle a regulatory investigation into how it managed mutual funds and other products that pick stocks based on environmental, social and governance criteria.The Securities and Exchange Commission said Goldman marketed the ESG funds and a similar investment strategy without always following a consistent framework spelled out in its compliance plans. That meant Goldman violated an SEC compliance rule that requires investment advisers to implement plans designed to prevent potential regulatory violations. Goldman neither admitted nor denied the SEC’s allegations.The SEC said the misconduct was related to the Goldman Sachs International Equity ESG fund, the ESG Emerging Markets Equity fund, and a U.S. equities ESG strategy it offered to clients whose money it managed. Goldman’s compliance policy said investment analysts would use a questionnaire to screen investments before adding them to funds or other portfolios, but the forms weren’t always completed before stocks were added, the SEC said.

Goldman Sachs to Pay $4 Million to Settle Investigation Over ESG Funds – WSJ

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