Today, the 13th of July, the European Commission’s High Level Expert Group on Sustainable Finance (HLEG) published its Interim Report. This Report identifies two imperatives for Europe’s financial system.
- The first is to strengthen financial stability and asset pricing, by improving the assessment and management of long-term material risks and intangible factors of value creation, including those related to environmental, social and governance (ESG) issues.
- The second is to improve the contribution of the financial sector to sustainable and inclusive growth, notably by financing long-term needs such as innovation and infrastructure, and accelerating the shift to a low carbon and resource-efficient economy.
Eurosif’s Executive Director, Flavia Micilotta, said:
“The HLEG Interim Report, in line with the mandate of the group, looks at the role that finance can play in ensuring that investment protects the environment and promotes economic systems that are truly sustainable. The basis of this reasoning is understanding that there is a fundamental paradigm shift that we need to make and which is linked to certain ‘interdependencies’. The same ones that define what constitutes a ‘productive’ investment are linked to a project’s environmental and socio-economic impacts.”
In their foreword to the report, Valdis Dombrovskis, Vice-President for the Euro and Social Dialogue, also in charge of Financial Stability, Financial Services and Capital Markets Union and Jyrki Katainen, Vice-President for Jobs, Growth, Investment and Competitiveness wrote:
“The Interim Report provides a set of recommendations for action, which we welcome. In particular, we believe that suggestions for a classification system for sustainable assets and a European standard and label for green bonds have great potential. They should be explored further, as a step towards our long-term goal of establishing EU labels and quality standards for all sustainable assets. These labels will provide the confidence and trust in sustainable and green products needed for investors to fund the transition to the low-carbon economy. “
Christian Thimann, Chair of the High-Level Expert Group said:
“Sustainable finance means ‘better development’ and ‘better finance’ – development that is sustainable in each of its economic, social and environmental dimensions; and a financial system that is focused on the longer term as well as material ESG factors.“
To mark the Report’s publication, Eurosif is hosting a roundtable today to dissect the main points with HLEG Chair in a conversation with key stakeholders. For more details, please click here.