Stockholm (NordSIP) – On Wednesday, April 8th, the European Commission (EC) launched a consultation on the renewed sustainable finance strategy. The renewed strategy, based on the 2018 Action Plan on Financing Sustainable Growth, aims to provide a roadmap to increase private investment in sustainable projects and to manage and integrate climate and environmental risks into our financial system. The initiative will also provide additional frameworks for the European Green Deal Investment Plan.
Reacting to the consultation, the European Fund and Asset Management Association (EFAMA) highlighted several points. First, it noted that since the launch of the 2018 Action Plan, a series of other environmental legislative initiatives had led to some inconsistencies which the renewed sustainable finance strategy should address. Next, it emphasised that the economic disruption caused by the COVID19 outbreak should focus sustainability on the social factor to facilitate economic stabilisation. EFAMA also questioned whether now is the right time to focus on new governance initiatives, especially given the existence of corporate governance and stewardship codes. Finally, it regretted that financial literacy and promoting sustainability awareness seemed to be “somewhat sidelined in the consultation”.
“We agree that the current COVID-19 crisis underlines the need to strengthen the sustainability and resilience of our societies,” said EFAMA’s Director-General, Tanguy van de Werve. “For that, the sustainable finance strategy needs to carefully consider the impact the pandemic crisis has on our society and economies, and the financing needs it will create. We need a balanced transition that allows appropriate distribution of resources across the different sectors. We cannot afford leaving behind part of the economy or of society.”
EFAMA represents 28 member associations and 60 corporate members. At end 2019, total net assets of European investment funds reached €17.8 trillion. These assets were managed by close to 34,200 UCITS (Undertakings for Collective Investments in Transferable Securities) and 29,000 AIFs (Alternative Investment Funds).
Interested parties can find more detail on the EC’s consultation here.