Natixis News

European Commission's Action Plan for a greener and cleaner economy follows HLEG’s recommendations

The European Commission has unveiled its strategy for a financial system that supports the EU's climate and sustainable development agenda.

In late 2016 the European Commission announced the members of a High-Level Expert Group (HLEG) on sustainable finance, which was tasked with developing a comprehensive strategy in this field for the European Union.

The group has 20 members from civil society, the financial sector and the academic world. One of these is Philippe Zaouati, CEO of Mirova, an affiliate of Natixis Investment Managers dedicated to sustainable investment. Philippe Zaouati is also president of Finance for Tomorrow, an initiative sponsored by Paris EUROPLACE and Paris market participants to promote sustainable finance in France and internationally.

After one year of work, the HLEG released its final report on 1 February 2018 (which you can view here). Inspired by their final report, the European Commission is proposing an EU strategy on sustainable finance setting out a roadmap for further work and upcoming actions covering all relevant actors in the financial system. These include:

  • Establishing a common language for sustainable finance, i.e. a unified EU classification system – or taxonomy – to define what is sustainable and identify areas where sustainable investment can make the biggest impact.
  • Creating EU labels for green financial products on the basis of this EU classification system: this will allow investors to easily identify investments that comply with green or low-carbon criteria.
  • Clarifying the duty of asset managers and institutional investors to take sustainability into account in the investment process and enhance disclosure requirements.
  • Requiring insurance and investment firms to advise clients on the basis of their preferences on sustainability.
  • Incorporating sustainability in prudential requirements: banks and insurance companies are an important source of external finance for the European economy. The Commission will explore the feasibility of recalibrating capital requirements for banks (the so-called green supporting factor) for sustainable investments, when it is justified from a risk perspective, while ensuring that financial stability is safeguarded.
  • Enhancing transparency in corporate ESG reporting:

The next step is the presentation to the stakeholders of the European Commission’s comprehensive Action Plan on sustainable finance, due out on 22 March 2018.

For further reading

Analysis of HLEG’s final recommendations by Philippe Zaouati, CEO at Mirova, Chair at Finance For Tomorrow

Mirova
An affiliate of Natixis Investment Managers
A subsidiary of Natixis Asset management
Limited liability company
Share Capital: €8 322 490.00 €
Regulated by the Autorité des Marchés Financiers (AMF) under n° GP 02014.
RCS Paris n° 394 648 216
59 avenue Pierre Mendès France
75013 Paris, France
www.mirova.com

Natixis Asset Management
An affiliate of Natixis Investment Managers
Limited liability company
Share capital €50,434,604.76
Regulated by the Autorité des Marchés Financiers (AMF) under no. GP 90-009
RCS Paris n°329 450 738
43 avenue Pierre Mendès France
75013 Paris, France
www.nam.natixis.com

Natixis Investment Managers
RCS Paris 453 952 681
Share Capital: €178 251 690
43 avenue Pierre Mendès France
75013 Paris, France
www.im.natixis.com

This communication is for information only and is intended for investment service providers or other Professional Clients. The analyses and opinions referenced herein represent the subjective views of the author as referenced unless stated otherwise and are subject to change. There can be no assurance that developments will transpire as may be forecasted in this material.

NGAM News