The European Commission welcomes the final report by its High-Level Expert Group on Sustainable Finance (HLEG), which sets out strategic recommendations for a financial system that supports sustainable investments.
The Commission will now move to finalise its strategy on sustainable finance on the basis of these recommendations. Delivering an EU strategy on sustainable finance is a priority action of the Commission’s Capital Markets Union (CMU) Action Plan, as well as one of the key steps towards implementing the historic Paris Agreement and the EU’s Agenda for sustainable development. To achieve the EU’s 2030 targets agreed in Paris, including a 40% cut in greenhouse gas emissions, we need around €180 billion of additional investments a year. The financial sector has a key role to play in reaching those goals, as large amounts of private capital could be mobilised towards such sustainable investments. The Commission is determined to lead the global work in this area and help sustainability-conscious investors to choose suitable projects and companies.
The Commission is launching a public consultation on how asset managers and institutional investors could include environmental, social and governance factors when taking decisions.
This would help them allocate capital more efficiently by taking into account sustainability risks, rather than merely seeking to maximise short-term financial returns. Today’s consultation follows up on one of the eight early recommendations delivered by the High-Level Expert Group on Sustainable Finance (HLEG) in its interim report of July 2017. It forms part of the Commission’s efforts to mobilise private capital towards green and sustainable investments to enable the transition to a low-carbon economy and shows the EU’s strong commitment to mitigate risks posed by climate change and environmental challenges. The EU has taken the lead in building a financial system that supports sustainable growth and sustainable finance continues to be one of the Juncker’s Commission’s main priorities. The consultation further underlines the EU’s commitment to the Paris Climate Agreement and the UN 2030 Agenda for Sustainable Development. As announced in its 2018 Work Programme, the Commission will adopt an Action Plan on sustainable finance in the first quarter of 2018.