The financial sector has a vital role to play in reaching the climate change goals of the Paris Agreement and the EU's 2030 Agenda for sustainable development. It is also vital that more private capital is mobilised towards green and sustainable investment so as to enable the transition to a low-carbon economy: investments of around €180 billion per year are needed to deliver on the EU's ambitious climate and energy goals.
The interim report by High-Level Group maps out the challenges and opportunities that the EU faces in developing a sustainable finance policy agenda, identifying possible areas of reform in financial policy. It also presents a first set of early recommendations to the Commission. The expert group will further explore other policy areas to provide further recommendations in the final report, due at the end of 2017.
The areas on which the interim report proposes quick action include a classification system for sustainable assets, a European standard and label for green bonds, fiduciary duty that encompasses sustainability, better disclosure from financial institutions and companies on how sustainability is factored into decision-making and a 'sustainability test' for relevant EU financial legislation.
The interim report was discussed at a public hearing on sustainable finance organised by the European Commission on July 18, 2017 in Brussels. Maxim Titov, Executive director of ENERPO Research Center, was invited to participate to this public consultation with an intention to help the group to deepen its analysis and shape its policy recommendations.
Background
The European Union has been at the forefront of efforts to build a financial system that supports sustainable growth. In 2015, landmark international agreements were established with the adoption of the UN 2030 Agenda and Sustainable Development Goals and the Paris Climate Agreement. The EU has set itself ambitious climate, environmental and sustainability targets, for instance through its 2030 Energy and Climate framework, the Energy Union and its Circular Economy Action Plan.
The High-Level Group was established in December 2016 as part of the Commission's commitment to the Paris Climate Agreement. It is made of 20 senior experts from civil society, the finance sector, academia and observers from European and international institutions.
For More Information
High-Level Expert Group on Sustainable Finance: https://ec.europa.eu/info/business-economy-euro/banking-and-finance/sustainable-finance_en#high-level-expert-group-on-sustainable-finance
Sustainable Finance Interim Report: https://ec.europa.eu/info/publications/170713-sustainable-finance-report_en