EC is consulting on the Renewed Sustainable Finance Strategy, which is an integral part of the European Green Deal and of the overall efforts to ensure a sustainable and resilient economic recovery, following the COVID-19 outbreak. The consultation is intended to collect views and opinions to feed into the work to help mobilize private investment in sustainable projects. EC aims to adopt the Renewed Sustainable Finance Strategy in the second half of 2020. The consultation will be open until July 15, 2020.
This renewed strategy will build on previous initiatives and reports, such as the 2018 EC Action Plan on Financing Sustainable Growth and the reports of the Technical Expert Group on Sustainable Finance. The renewed sustainable finance strategy will provide a roadmap, with new actions to increase private investment in sustainable projects and activities to support the actions set out in the European Green Deal. The initiative will also provide additional enabling frameworks for the European Green Deal Investment Plan. Within the broader context of the European Green Deal Investment Plan, the Renewed Strategy will focus on three areas:
- Strengthening the foundations for sustainable investment by creating an enabling framework, with appropriate tools and structures. Many financial and non-financial companies still focus excessively on short-term financial performance, instead of the long-term development and sustainability-related challenges and opportunities.
- Increased opportunities to have a positive impact on sustainability for citizens, financial institutions, and corporates. The aim is to maximize the impact of the frameworks and tools to “finance green.”
- Climate and environmental risks will need to be fully managed and integrated into financial institutions and the financial system as a whole, while ensuring social risks are duly taken into account, where relevant. Reducing the exposure to climate and environmental risks will further contribute to greening the finance.
Comment Due Date: July 15, 2020
Keywords: Europe, EU, Banking, Insurance, Securities, Sustainable Finance, Climate Change Risk, ESG, European Green Deal, Social Risk, EC
Dr. Denton provides industry leadership in the quantification of sustainability issues, climate risk, trade credit and emerging lending risks. His deep foundations in market and credit risk provide critical perspectives on how climate/sustainability risks can be measured, communicated and used to drive commercial opportunities, policy, strategy, and compliance. He supports corporate clients and financial institutions in leveraging Moody’s tools and capabilities to improve decision-making and compliance capabilities, with particular focus on the energy, agriculture and physical commodities industries.
Previous ArticleEBA Examines Impact of Capital and Liquidity Reforms on Banks in EU
The European Banking Authority (EBA) published four draft principles to support supervisory efforts in assessing the representativeness of COVID-19-impacted data for banks using the internal ratings based (IRB) credit risk models.
The European Council and the European Parliament (EP) reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD).
The Prudential Regulation Authority (PRA) launched a consultation (CP6/22) that sets out proposal for a new Supervisory Statement on expectations for management of model risk by banks.
The European Commission (EC) published the Delegated Regulation 2022/954, which amends regulatory technical standards on specification of the calculation of specific and general credit risk adjustments.
The Bank for International Settlements (BIS) Innovation Hub updated its work program, announcing a set of projects across various centers.
The European Insurance and Occupational Pensions Authority (EIOPA) published two consultation papers—one on the supervisory statement on exclusions related to systemic events and the other on the supervisory statement on the management of non-affirmative cyber exposures.
Certain members of the U.S. Senate Committee on Banking, Housing, and Urban Affairs issued a letter to the Securities and Exchange Commission (SEC)
The European Insurance and Occupational Pensions Authority (EIOPA) published a consultation paper on the advice on the review of the securitization prudential framework in Solvency II.
The Prudential Regulation Authority (PRA) issued a statement on PRA buffer adjustment while the Bank of England (BoE) published a notice on the statistical reporting requirements for banks.
The Basel Committee on Banking Supervision (BCBS) issued principles for the effective management and supervision of climate-related financial risks.