News: BHP UPDATE 1-Australian securities regulator sues Mercer Super for alleged greenwashing

(Updates with details on court action, greenwashing)

Feb 28 (Reuters) - Australian securities regulator said on Tuesday it was taking legal action against corporate super funds firm Mercer Superannuation for allegedly misleading members about the sustainability of some of its retirement investment options.

This is the Australian Securities & Investments Commission's (ASIC) first such ever court action against alleged greenwashing conduct at a time of increased demand for environmentally- friendly, sustainable or ethical investment options.

The ASIC calls greenwashing a market term for the potential for funds to over-represent the extent to which their practices are environmentally friendly, sustainable or ethical.

The regulator alleged Mercer made statements on its website about seven "Sustainable Plus" investment options, marketing them as suitable for members "deeply committed to sustainability" as the options excluded investments in companies involved in carbon intensive fossil fuels like thermal coal.

However, the options had investments in companies the statements said were excluded, for example BHP Group (BHP) , the world's largest listed miner, Australia's top power producer and carbon emitter AGL Energy (AGL) , among several others, the regulator alleged.

"In doing so, ASIC alleges Mercer made false and misleading statements and engaged in conduct that could mislead the public," the ASIC said.

"There is increased demand for sustainability-related financial products, and with that comes the growing risk of misleading marketing and greenwashing."

Mercer Superannuation did not immediately respond to a Reuters request for comment. (([email protected]; Twitter: https://twitter.com/sameer_manekar))