Europe’s new rules on sustainable finance were meant to help investors hunt out truly ethical funds. Instead, they have gifted sheep’s clothing to the wolves: asset managers say many undeserving funds now declare themselves green.

Admittedly, the granular reporting requirements that come with an ethical label are not yet in force. But even when they do kick in, there is scepticism the fully-fledged Sustainable Finance Disclosure Regulation will combat greenwashing. Another fix may be necessary