The Green Equity Guidelines are a draft memorandum circular that, according to ESG News, lays out steps to promote the issuance of green equity in line with international sustainability commitments such as the Paris Agreement and the Sustainable Development Goals (SDGs) of the UN.

According to the ASEAN Taxonomy for Sustainable Finance and the Philippine Sustainable Finance Taxonomy Guidelines (SFTG), businesses that want to issue green equity must make sure that at least 50% of their investments and income come from environmentally friendly ventures. These businesses must also establish, publish, and externally validate quantifiable and comparable key performance indicators (KPIs) associated with their environmental goals. Progress reports must be posted on certain websites.

Companies that apply for the Green Equity designation must pass stringent evaluations conducted by impartial outside reviewers, per SEC regulations. By making these reports publicly available, these assessments aim to ensure adherence to the rules and improve investor transparency.

The Green Equity Guidelines were introduced with the intention of making businesses that actively support environmental sustainability more visible. In addition to other sustainable investment products like green bonds, it aims to direct more funds into companies that promote a low-carbon and climate-resilient economy.

Companies must apply through the SEC's Markets and Securities Regulation Department (MSRD) in order to be eligible for the Green Equity designation. They must also submit frequent updates on their environmental objectives and performance in relation to predetermined KPIs. To keep their accreditation, they must also complete thorough triennial evaluations and yearly restricted reviews.

The Securities Regulation Code (SRC) and other legislation contain potential fines, and the SEC cautions that if a business does not satisfy the criteria, it will remove the Green Equity badge. The SEC encourages stakeholders to provide input via email to help refine the plan, and the guidelines are available for public comment until January 25, 2025.