The Securities and Exchange Commission (SEC) is holding a hearing to improve the criteria for "SRI mutual funds" to increase transparency and build investor confidence.

The Securities and Exchange Commission (SEC) is accepting comments on a draft announcement regarding improvements to the "SRI Mutual Fund" regulations, raising transparency to international standards.

29 August 2568 Securities and Exchange Commission (SEC) opens for public hearing on the draft announcement regarding the improvement of the criteria for SRI* (Sustainable and Responsible Investing Fund) mutual funds. To elevate regulatory standards, increase transparency, and build investor confidence, as well as prevent the risk of greenwashing.

The Securities and Exchange Commission (SEC) recognizes the important role of asset management companies (AMCs) and SRI mutual funds in promoting sustainable development through capital market mechanisms. Therefore, the SEC has developed the concept of improving the criteria for SRI mutual funds and has drafted four related announcements, the key points of which are as follows:

(1) Defining sustainability objectives with corresponding logos, divided into 5 categories: SRI Focus, SRI Improver, SRI Promote, SRI Impact, and SRI Mixed Goals, including the determination of businesses in which SRI mutual funds are prohibited from investing (minimum exclusion list).

(2) Improving information disclosure by requiring asset management companies to disclose important information such as sustainability indicators and results, sustainability risks, and management approaches when investments do not comply with policy, including explanations of sustainability terminology.

(3) Post-investment reporting, whereby the asset management company prepares an engagement report with the invested business and updates the accounting period report to cover more sustainability information.

(4) Creating a “Sustainability Corner” in the prospectus summarizing important information to enable investors to conveniently access and compare sustainability information of SRI mutual funds.

(5) Relaxation of the use of impact verifiers on a voluntary basis, subject to appropriate supervision and investor protection.

(6) Improving the requirements to be consistent with the Thailand ESG Fund and the Thailand ESG Extra Fund in (1) using a performance benchmark that is a total return index (TRI) that takes into account the proportion of retail shareholders of each security (free float) as a weight in calculating the index, and (2) considering the qualifications and selecting sustainability performance assessors in accordance with international standards.

In addition, the SEC has specified relevant details for the disclosure of sustainability information for SRI mutual funds that are mutual funds (fund of funds) or feeder funds to provide clarity in practice.

To support a smooth transition, SRI mutual funds registered before the effective date of this announcement will have a six-month period to update their information disclosure to comply with the new criteria. Alternatively, if they do not wish to comply with the new criteria, the asset management company must amend its name and investment policy within the same period. For other mutual funds that are not SRI mutual funds but use names or investment policies related to sustainability**, they will have a one-year period to update their information disclosure to comply with the new criteria or to amend their name or investment policy to avoid investor misunderstanding.

The SEC has published a public hearing document detailing the amendments to the draft announcement on the SEC website. https://www.sec.or.th/TH/Pages/PB_Detail.aspx?SECID=1104 and the legal system https://law.go.th/listeningDetail?survey_id=NTc0NERHQV9MQVdfRlJPTlRFTkQ= Those interested and concerned can express their opinions through the website or by email at chanthamon@sec.or.th or sireetho@sec.or.th until September 30, 2568.