Last year, the European Commission launched its action plan on sustainable finance with the aim of demonstrating its leadership in this area (see EUROPE 11987/13). This year, at the high-level international conference on sustainable finance on Thursday 21 March, his objective was to look beyond European borders and launch a reflection on a global approach.
Europe is at the forefront of the fight against climate change, said European Commissioner for Financial Services Valdis Dombrovskis. But it is not the only one and, in terms of sustainable finance, countries such as China, India, Chile, Canada and Morocco have also made significant progress.
"Given what we have achieved individually, I believe that sustainable finance can be truly transformative if we join forces", said the Commissioner.
For him, the Coalition of Finance Ministers for Climate Action is leading by example by integrating climate change and environmental issues into the finance ministers' macroeconomic policy agenda.
"Last night, I had the opportunity to exchange views with a number of like-minded colleagues [...] we agreed to keep working towards creating an international network on Sustainable Finance", he also announced. Argentina, Canada, China, India, Japan and Morocco would be particularly interested in such an initiative.
During the conference, the various speakers discussed the measures implemented in their respective countries. China, for example, has developed a taxonomy on green loans since 2013 and a taxonomy on green bonds since 2015. The country has also put in place incentives and standards for the disclosure of climate information.
But when asked about the current level of international coordination in this area, participants were rather disappointed and not very optimistic.
Ashley Ian Alder, of the Hong Kong Securities and Futures Commission, said that it would take too long to reach a consensus at the international level and that it would be better to have more limited cooperation. "You have to work with as many countries as possible, but that doesn't necessarily mean with everyone", he explained. And he believes that we should start by thinking about a regulatory approach.
For French Minister Brune Poirson, political commitments at the highest level remain fundamental. The Minister would prefer to have a dynamic by region or group of countries and felt that the G20 or G7 would be appropriate forums for reflection and discussion.
The Moroccan Minister of Finance, Mohamed Benchaâboun, said that this culture of sustainable finance must first be disseminated and that, for this, a global proposal force was needed. However, he rejected any "one-size-fits-all approach", advocating that due account be taken of the realities on the ground and the differences in development between countries.
New recommendations from the EU expert group in June
While the road to a global approach to sustainable finance still seems long, the EU continues to refine its approach.
Of the three legislative proposals tabled by the European Commission to implement its action plan (see EUROPE 11977/2), two have been adopted, Commissioner Dombrovskis recalled. "In just over two years, we have created a completely new body of EU legislation from scratch", he welcomed.
Only the European taxonomy on sustainable finance, on which Parliament adopted its position this week (see EUROPE 12212/9), remains. "Our taxonomy proposal has progressed well in the European Parliament and I therefore hope that it will be successfully voted on in plenary next week. And I hope that we will also reach a political consensus in the Council of the EU in the coming months", he said.
The European Commission's expert group on sustainable finance will also publish a new set of recommendations in June, the Commissioner announced. In addition, it will publish its report on the European taxonomy on climate change and finalise its report on the first European standard on green bonds.
Finally, the Commission will update its 2017 non-binding guidelines on non-financial information to include climate information (see EUROPE 12199/27).
On Wednesday 20 March, Commissioner Dombrovskis told a handful of journalists that the idea of a "green supporting factor" that would set, for example, reduced capital requirements for banks to stimulate green investment and lending, which the Commission had considered when drawing up its action plan, had not yet been implemented.
There was no majority support for this idea, neither in the Council of the EU nor in the European Parliament, so the measure is not part of the current legislative agenda, he regretted, before considering that discussions on this subject should resurface in the future.
Asked about the priorities for sustainable finance for the next European Commission, the Commissioner called for continuity. In his view, it would be necessary to conclude the work in progress, extend the taxonomy to other aspects, in particular social aspects, and above all continue coordination at the international level. (Original version in French by Marion Fontana)