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The action is part of the commission actively monitoring the market and investigating, it says.
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ASIC levies first greenwashing penalty on energy company
28 October 2022
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ASIC has taken its first action against greenwashing by fining listed company Tlou Energy Ltd $53,280 for four infringements.
The infringement notices were triggered by allegedly false or misleading sustainability-related statements made to the ASX in October 2021.
In those announcements Tlou claimed that:
- Electricity produced by Tlou would be carbon neutral.
- Tlou had environmental approval and capability to generate certain quantities of electricity from solar power.
- Tlou’s gas-to-power project would be “low emissions”.
- Tlou was equally concerned with producing “clean energy” through the use of renewable sources as it was with developing its gas-to-power project.
ASIC said it was concerned that Tlou either did not have a reasonable basis to make the representations or that the representations were factually incorrect.
Tlou responded yesterday with a statement contesting the ASIC findings.
“Tlou does not accept that it contravened any provision of the Corporations Act 2001 (Cth) or the Australian Securities and Investments Commission Act 2001 (Cth) but agreed to pay the infringement notices to bring this matter to an end and focus the company’s resources on development of its power projects,” it said.
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The action comes after ASIC flagged greenwashing as a key concern earlier this year.
“As entities promote sustainability and green practices as part of their value proposition, they must ensure they can support those statements and have a reasonable basis for doing so,” said ASIC deputy chair Sarah Court.
“ASIC is currently investigating a number of listed entities, super funds and managed funds in relation to their green credentials claims.”
“Companies are on notice that ASIC is actively monitoring the market for potential greenwashing and will take enforcement action, including court action, for serious breaches.”
ASIC defines greenwashing as the practice of misrepresenting the extent to which a financial product or investment strategy is environmentally friendly, sustainable or ethical - and sustainable finance is a key priority.
ASIC confirmed that Tlou paid the infringement notices on 25 October 2022 and that payment of an infringement notice was not an admission of guilt or liability.
Tlou Energy Limited develops power solutions in sub-Saharan Africa through coalbed methane gas-fired power, solar power, and hydrogen projects.
Tlou’s Lesedi Project was the company’s first gas-to-power development and has achieved a purchase agreement with the Botswana Power Corporation, the national power utility in Botswana.
Tlou’s shares closed at 0.025 yesterday.
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