Eurosif Response to EC Green Paper LTI
Eurosif welcomes the Consultation on the Green Paper on the long-term financing of the European economy. Eurosif acknowledges that some assets are more likely than others to be managed for the long-term, due to certain characteristics such as liquidity. Long-term investors will manage assets for the long term. Long-term investments may be acquired by all investors, short or long term, but are (or should be) a proportionally greater part of a long-term investor’s portfolio. In order for the European economy to benefit from more long-term productive capital, Eurosif supports the creation of specific legal frameworks to channel more investments into these assets, as this may make them more attractive to investors, especially if combined with incentives such as tax-breaks. However, it is imperative to avoid signalling to the market that assets not covered by such legislation are implicitly short term and the creation of such instruments must not overshadow the need to incentivise the broader capital markets to behave in a more long-term manner.
Download Position Paper here.