Bond Investors Challenge Wall Street Greenwashing

Bond fund manager James Rich’s job is to find sustainable investments for his customers. Lately, he is rejecting much of what Wall Street is offering him.

Mr. Rich is part of a budding backlash among investors who are increasingly wary of “greenwashing” in bonds labeled as eco-friendly. One example: Mr. James cut a green bond issued by JPMorgan from the roughly $200 million sustainable investing portfolio he runs at Aegon Asset Management over doubts about the bank’s overall environmental record. A mutual fund he submanages for Transamerica Asset Management Inc. jettisoned the bond in the first quarter, according to financial filings by Transamerica.