• Large funds gain until June 11, 2026, to comply.
• Smaller funds compliance extended to Dec. 11, 2026.
• Alignment designed to minimize operational costs.

The SEC announced a six-month delay for funds to comply with the recently amended Investment Company Act “Names Rule,” which ensures fund investments match their advertised ESG or sustainability strategies.

• Larger fund groups (> $1 billion in net assets) now have until June 11, 2026.
• Smaller fund groups (< $1 billion in assets) must comply by Dec. 11, 2026.

This adjustment aligns compliance with annual reporting obligations to reduce financial and operational burdens.

“The extension is designed to balance the investor benefit of the amended Names Rule framework with funds’ needs for additional time to implement the amendments properly, develop and finalize their compliance systems, and test their compliance plans,” the SEC stated.

The Names Rule mandates that at least 80% of a fund’s investments reflect its stated objectives, such as ESG or sustainability themes.

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Former SEC Chair Gary Gensler noted the rule aims to “help ensure that a fund’s portfolio aligns with a fund’s name.”

Acting SEC Chair Mark Uyeda indicated similar compliance extensions may be considered for other recent SEC rules.

“We must be clear-eyed about how existing proposals fare under this rubric,” Uyeda emphasized, underscoring a balanced approach to rule implementation.

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