Stockholm (NordSIP) – “ESG integration in Germany is on average less advanced than in neighbouring France, the Netherlands, the UK and Scandinavia” is the perhaps surprising finding according to industry experts who have contributed to The Germany Roadmap, the latest publication from the PRI, UNEP FI and The Generation Foundation.
The Roadmap, which builds on the report Fiduciary Duty in the 21st Century, nevertheless indicates recent momentum for sustainable finance initiatives in Frankfurt and Berlin, with the Federal Government implementing several measures to address ESG integration, such as commissioning analysis on financial stability risks relating to climate change.
The Roadmap makes recommendations based on four priority themes in order to continue encouraging the full integration of ESG issues across German capital markets:
- Government leadership;
- Legal clarity and consistency on ESG integration for institutional investors;
- Guidance for fund managers, and
- High quality disclosure of ESG factors by investors as part of the implementation of the CSR directive.
The recommendations draw on 25 interviews with key German stakeholders and identify policy examples from mature financial markets such as the U.S., UK, Canada and at the European level, some of which have already been the subject of other PRI-UNEP-Generation Foundation roadmaps, as part of their fiduciary duty project.
“The German roadmap provides policy and investment practice actions to embed ESG in fiduciary duties,” said PRI’s Nathan Fabian. “The sustainable finance agenda is gaining momentum in Germany, most recently with the launch of the Frankfurt Declaration. We are grateful for the input of our signatories and partners from across government and industry and look forward to working together to put these recommendations into action.”
“A widely understood fiduciary duty is a key factor for the development of a sustainable financial system. The PRI and UNEP FI’s work provides valuable suggestions for Germany and Europe,” said Michael Schmidt, Deka Investment GmbH “The aim must be high-quality harmonization of international standards and policy frameworks.”
“The Roadmap is a valuable contribution and promotes the integration of ESG aspects,” said Kristina Jeromin, Deutsche Börse AG.