Ambition and cohesiveness key to delivering CMU plans

20 March 2017

In its response to the latest consultation on the Capital Markets Union (CMU) Mid-term review, Eurosif urged the European Commission to infuse more drive in the CMU policy framework and strive for policy cohesiveness in its strategic plans. The CMU implementation state of play already indicates positive advancements for several actions.

These positive results demonstrate the extent to which those actions are likely to spur concrete positive outcomes, helping companies gain easier access to finance. Eurosif continues to advocate further scaling up long-term sustainable growth by leveraging financial innovation.

In its submission, Eurosif particularly focused on:

◦ Enhanced environmental and social reporting and screening becoming a standard feature of all investment vehicles and financial instruments aligned with the CMU objectives;

◦ A clear definition of the concept of fiduciary duty, too often interpreted by many investors, investment advisors and pension consultants, as a duty to maximise short-term return;

◦ More efforts to focus on the European Investment Plan which through mechanisms, such as EFSI, could increase pension funds' cross-border investment in the EU;

◦ Infrastructure investment to become a more accessible asset class for institutional investors, through increasing transparency and harmonisation of project pipelines, structures, financing and performance;

◦ Push for financial literacy to become a critical element in the mainstreaming of sustainable investment. Europe needs to do more to increase the level understanding of finance for European consumers and retail investors. Initiatives like PRIIPs represent an excellent platform to achieve this goal and factor in an understanding of ESG criteria.

To read the full Eurosif submission, please click here.