European Commission report on Sustainable Finance affirms its commitment to climate action

The European Commission’s High-Level Expert Group (HLEG) on Sustainable Finance has identified ways that the finance sector can re-connect with the real economy to support the transition to a more resource-efficient and more circular economy. 

The final report by its High-Level Expert Group on Sustainable Finance (HLEG), published today, sets out strategic recommendations for a financial system that supports sustainable investments including:

  • a classification system, or ‘taxonomy’, to provide market clarity on what is ‘sustainable’

  • clarifying the duties of investors’ when it comes to achieving a more sustainable financial system

  • improving disclosure by financial institutions and companies on how sustainability is factored into their decision-making

  • an EU-wide label for green investment funds

  • making sustainability part of the mandates of the European Supervisory Authorities (ESAs)

  • a European standard for green bonds.

The group argues that reorienting investment flows into long-term, sustainable projects will also improve the stability of the financial system.

Valdis Dombrovskis, Vice-President responsible for Financial Stability, Financial Services and Capital Markets Union said: “The signature of the Paris Agreement in 2015 marked a milestone for the world and for the global economy. We are now moving towards a low-carbon society, where renewable energy and smart technologies improve our quality of life, spurring job creation and growth, without damaging our planet. Finance has a big role to play in funding a sustainable future.”

Jyrki Katainen, Vice-President responsible for Jobs, Growth, Investment and Competitiveness said: “The EU is already at the forefront of investing in resource efficiency and social infrastructure, not least through the European Fund for Strategic Investments and its reinforced focus on climate action. At the same time, creating an enabling framework for private investors is crucial to achieving the transition to a cleaner, more resource-efficient, circular economy.”

Climate-KIC is fostering innovation in finance and metrics that helps shift flows from fossil-fuel based assets to greener assets, by mainstreaming climate into financial decision making as well as ensuring climate risk information is widely accessible. 

Riyong Kim Bakkegaard, Interim Director, Decision Metrics and Finance at EIT Climate-KIC commented on the report:

“Finance is key to meeting the challenges of climate change. Historically, the costs of climate change have been external to the modern-day financial system, and therefore, it’s not that there’s a lack of finance but it’s that more financial flows need to be directed to pro-climate assets.

Climate technologies and policies are key to reducing emissions and adapting to climate change. Channelling finance to pay for these emissions reductions and adaptation strategies are the next challenge. The HLEG’s final report provides us with guidance on what the sector can do.”

As a pan-European network, Climate-KIC is in a position to help Europe achieve the recommendations outlined in the report.

This year, Climate-KIC will embark on an ambitious programme of climate finance and metrics work, together with its partners to help trigger a shift towards climate action.

The European Commission’s report will form the basis of the Commission’s forthcoming comprehensive Action Plan on sustainable finance.

Both the findings of the report and the Commission’s Action Plan will be discussed at a high-level conference on 22 March 2018 in Brussels.

See the report in full here.

 
Location
Articles you may be interested in
In The News
Research reveals surprising link between socio-economic indicators and sustain...

A new study by EIT Climate-KIC partner academic institutions...

Research reveals surprising link between socio-economic indicators and sustainability transition
Opinion
Transformation capital: A new investment logic for catalysing systems change
Dominic Hofstetter Transformation Capital, EIT Climate-KIC
Transformation capital: A new investment logic for catalysing systems change
Opinion
Innovating in complexity: From single-point solutions to directional systems innovation
Dominic Hofstetter TRANSFORMATION CAPITAL, EIT CLIMATE-KIC
Innovating in complexity: From single-point solutions to directional systems innovation
In The News
Four EIT Climate-KIC innovators nominated for annual EIT Awards

The European Institute of Innovation and Technology (EIT) has released...

Four EIT Climate-KIC innovators nominated for annual EIT Awards
In Detail
Report offers recommendations for development of agricultural impact tool

A new report supported by EIT Climate-KIC’s CSA Booster programme proposes technical, governance and business arrangements for the development of a new tool for...

Report offers recommendations for development of agricultural impact tool
In Detail
Food value chains strategy report offers recommendations based on systemic i...

A new report details the work of EIT Climate-KIC and its partner Metabolic, a consulting company using systems thinking to tackle major sustainability challenges,...

Food value chains strategy report offers recommendations based on systemic impact
In The News
EIT Climate-KIC supports digital roadmap for a circular economy

EIT Climate-KIC, along with several European stakeholders, is advocating...

EIT Climate-KIC supports digital roadmap for a circular economy
In The News
EIT Climate-KIC urges London to lead in turning climate emergency into action

Climate innovation agency EIT Climate-KIC welcomed today the first...

EIT Climate-KIC urges London to lead in turning climate emergency into action
Opinion
London Climate Action Week: Climate Innovation Insights
London Climate Action Week: Climate Innovation Insights
Opinion
How can we deliver a net-zero emissions UK?
Andy Kerr Director, UK & Ireland, EIT Climate-KIC
How can we deliver a net-zero emissions UK?
Opinion
Can we identify the tipping points for transformative climate action?
Susannah Fisher Strategic Research Lead, EIT Climate-KIC
Can we identify the tipping points for transformative climate action?
In The News
Study launched on decarbonising Europe’s heavy industries by 2050

Industry representatives, regional experts, academics and EU officials held...

Study launched on decarbonising Europe’s heavy industries by 2050
In our community
Interview with Yvon Slingenberg of DG Climate Action, European Commission
Interview with Yvon Slingenberg of DG Climate Action, European Commission
In Detail
Evaluating the benefits of improved cooking solutions: impact data in high r...

Gold Standard today released a research study by Vivid Economics that estimates the economic value of Gold Standard-certified project benefits related to climate, health,...

Evaluating the benefits of improved cooking solutions: impact data in high resolution
In The News
New EIT Climate-KIC supported report proposes basis for a future EU taxonomy i...

The European Commission has welcomed the publication of the...

New EIT Climate-KIC supported report proposes basis for a future EU taxonomy in legislation
In The News
WCEF 2019: The challenges and potentials of circular procurement in cities

Increasing population growth and urbanisation intensifies the pressure on...

WCEF 2019: The challenges and potentials of circular procurement in cities
In The News
First round of 15 winners of Reinventing Cities competition announced

C40 Cities and EIT Climate-KIC have announced 15 winners...

First round of 15 winners of Reinventing Cities competition announced
In The News
Lisbon’s City Finance Lab-backed green participatory budget awarded €5 mil...

Lisbon City Council’s first-ever ‘green’ participatory budget, an initiative...

Lisbon’s City Finance Lab-backed green participatory budget awarded €5 million for next cycle
In The News
WCEF 2019: ‘The circular economy in cities’

EIT Climate-KIC CEO Kirsten Dunlop emphasised the importance of...

WCEF 2019: ‘The circular economy in cities’
In Detail
New Report on Circular Procurement in public construction projects shows how...

Public procurement affects a substantial share of world trade, amounting to more than €1.3 trillion per year. In the EU, the public purchase of...

New Report on Circular Procurement in public construction projects shows how targeted action can drive system-level impact
In The News
EIT Climate-KIC at World Circular Economy Forum 2019

EIT Climate-KIC is playing a prominent role at the...

EIT Climate-KIC at World Circular Economy Forum 2019
In The News
17 EIT Climate-KIC solutions included in MI 100 Global High Impact listing

13 EIT Climate-KIC Accelerator start-ups and four EIT Climate-KIC...

17 EIT Climate-KIC solutions included in MI 100 Global High Impact listing
In The News
EIT Climate-KIC’s global cleantech competition ClimateLaunchpad is open ...

EIT Climate-KIC’s ClimateLaunchpad, the world’s largest green business ideas...

EIT Climate-KIC’s global cleantech competition ClimateLaunchpad is open for registration
Opinion
Transformation Capital: A new investment logic for catalysing systems change
Dominic Hofstetter Transformation Capital, EIT Climate-KIC
Transformation Capital: A new investment logic for catalysing systems change
In The News
EIT Climate-KIC supported SkyNRG develops Europe’s first sustainable jet...

SkyNRG announced plans to develop Europe's first sustainable aviation...

EIT Climate-KIC supported SkyNRG develops Europe’s first sustainable jet fuel production plant
Opinion
Collaboration is hard!
Ulrike Linnig Innovation Lead, DACH, EIT Climate-KIC
Collaboration is hard!
In The News
EIT Climate-KIC supported report shows how to reduce industrial CO2 emissions

A new joint report, published by RWTH Aachen University...

EIT Climate-KIC supported report shows how to reduce industrial CO2 emissions
In The News
London event showcases innovation behind new investor climate tool

Yesterday’s event, titled “Applying Climate Risk Data to Investment...

London event showcases innovation behind new investor climate tool
In our community
Interview with Francisco de la Torre, Mayor of Malaga, Spain
Interview with Francisco de la Torre, Mayor of Malaga, Spain
Opinion
Adapting to climate change in Europe: Building a systemic and urgent vision
Susannah Fisher, EIT Climate-KIC and Andrew Norton, IIED
Adapting to climate change in Europe: Building a systemic and urgent vision