France has implemented new regulations that limit the use of ESG fund labels to specifically target the fossil fuel industry

France will only allow funds to use the national ESG label if they blacklist fossil fuel companies that are expanding production.

Finance Minister Bruno Le Maire believes that excluding such companies is essential in the fight against climate change.

This move aims to make it easier for green investors to identify truly sustainable investments.

Belgium has also taken a similar stance on fossil fuel investments. The tougher criteria will apply from March next year, coinciding with Europe’s review of its landmark ESG investing rulebook.

The French government’s decision has faced opposition from the financial industry but has been welcomed by nonprofit organizations.

Learn more: Bloomberg