Vanguard Investments Australia has revealed it voluntarily informed the Australian Securities and Investments Commission (ASIC) of the error it detected in the product disclosure statements (PDS) for the Vanguard International Shares Select Exclusions Index Funds regarding environmental, social and governance and greenwashing issues.
In statement provided to selfmanagedsuper, the investment manager noted: “Vanguard self-reported the error to ASIC, consistent with its statutory obligations, and issued a supplementary product disclosure statement for each affected fund correcting the error.
“The error was the same for each of the three funds affected and arose from an unintended misdescription in the PDS of the exclusionary screens applied to the underlying investments in these funds. The relevant webpages and fact sheets were accurate in describing the exclusionary screens.”
Vanguard pointed out the error contained in the PDS was corrected immediately after it had been detected and no harm was done to investors as a result of the original material.
“The error in the product disclosure statements did not result in any adverse financial impact on investors and at no time would any of the three funds have held different securities if it had tracked the misdescribed index,” it said.
The statement reiterated the manager’s proactive approach with ASIC over the matter.
“Vanguard has acknowledged the error and fully cooperated with ASIC in relation to this matter. Importantly, ASIC has at no stage suggested that the error arose otherwise than inadvertently,” it said.
The self-reporting led to ASIC issuing the manager with three infringement notices on the grounds of greenwashing with reference to the Vanguard International Shares Select Exclusions Index Funds.
Vanguard Investments Australia paid the penalty of $39,960 associated with the infringement notices on 1 December.
The corporate regulator stressed this action should not not be interpreted as an admission of guilt or liability by Vanguard Investments Australia.
