Sustainable Finance (Communication)
The Commission is pressing for a more sustainable financial sector and has therefore submitted an Action Plan on the financing of sustainable growth. This provides inter alia for a classification system for sustainability (“EU taxonomy”) that will provide a basis for “sustainable” action by financial institutions, rating agencies, market analysts and investors.
In cep’s view, although an EU taxonomy may promote the development of a European market for sustainable financial products, the taxonomy will not necessarily correspond to investor preferences. Neither should institutional investors and asset managers be obliged by law to incorporate sustainability considerations into their investment decisions. A generally applicable reduction in capital requirements for banks by way of a “green supporting factor” will jeopardise financial market stability.