EBF PRESS RELEASE
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European banks support EU priorities in Sustainable Finance
- European taxonomy can support a global level playing field
- Smart regulatory framework required for effectiveness and impact
BRUSSELS, 20 March 2019 – Ahead of the European Commission’s High Level Conference on a Global Approach to Sustainable Finance, in Brussels on Thursday, the European Banking Federation wishes to underline its full support for the EU-level actions and initiatives in this field.
European banks share the view of European Commission and fully support the priorities that have been identified, in particular the need for more international coordination; effective deployment of private capital towards sustainable investments; and on developing digital services as part of the solution for mobilising sustainable finance across the globe.
The EC’s action plan is a significant step in developing an international regulatory system in which banks can play a concrete role in financing the global energy transition, decarbonization of the economy and achieving the objectives of the Paris Agreement and the SDGs of the United Nations.
The European Commission’s leadership and firm commitment to deliver on the action plan has substantially accelerated the sustainability agenda across Europe. Its proposals are forward-looking in their approach and cover a lot of ground in a way that is unprecedented by the work of any other institution so far.
The global nature of these issues as well as the global nature of financial markets justify a global response and global public-private partnership. As EBF we support EU coordination efforts at global level and encourage expanding the use of the EU taxonomy as a common language outside the EU once enough progress at the EU level has been made.
Global use of the taxonomy
The global use of taxonomy is important to remove uncertainty, ensure comparability and allow competitive solutions on a level playing field. The success of the taxonomy would mainly depend on its usability and its potential to be applied in an automated way into IT systems and processes.
Towards a smart regulatory framework
Furthermore, citizens and business in the European Union can benefit from a smart regulatory framework that bridges initiatives, fuels further development of innovative and sustainable products, and enables and encourages financing of the transformation to sustainable societies.
Despite many positive developments both regulatory and market based, emergence of market leaders and encouraging data, we are still talking about the need to redirect significant capital flows towards sustainable investments. We do believe that both legislative and non-legislative frameworks must be reviewed to encourage further shift towards sustainable economy.
Innovation and digitalisation
Finally, innovation and digitalization have already significantly transformed the financial sector in recent years and will continue to do so, providing further opportunities to boost financial inclusion. Digital finance and affordability of mobile phones and networks helped further expansion of financial services even in areas with no previous banking tradition, lifting many households out of poverty.
Financial institutions are exploring the use of digital technology as a lever for sustainable finance. Benefiting from the digital transformation and innovation, banks are finding ways to create new products and develop already existing products to support sustainable companies, projects and activities. To seize the full potential of technology, innovation and developments have to go hand in hand with modernizing education and improvement of digital skills for all people in their various roles as business owners, citizens, consumers.
For more information:
Raymond Frenken, Head of Communications & CSR, +32 2 508 3732, R.Frenken@ebf.eu
About the EBF:
The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from 45 countries. The EBF is committed to a thriving European economy that is underpinned by a stable, secure and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses and innovators everywhere. Website: www.ebf.eu Twitter: @EBFeu.
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]]>EBF advisor: Denisa Mularova
Publication date: 14 December 2018
The European Banking Federation supports the holistic and harmonized approach of the European Parliament to the sustainability agenda. To mobilize the capital for sustainable activities, we recognize the need to identify in a clear and operational manner what constitutes sustainable characteristics, improve transparency, data collection as well as step up the educational efforts. While recognizing the challenge of the tasks, it is important to find a balance between i) clear and unambiguous definitions that adequately identify all the risks and opportunities depending on the economic sectors considered, ii) greenwashing, iii) transparency on one hand and the operational feasibility to allow its usage by companies to improve their sustainable actions and reach the objectives set out in the Paris agreement on the other hand. It needs to be kept in mind that only “easy to understand” and “ready to use” tools will enable the mobilization of all actors in the required scale and timeframe.
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]]>Banks committed to interests of future generations
Brussels, 11 December 2017
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Considerable progress has been made since the adoption of the Paris Agreement in 2015. The signature of the agreement secured the will to fight against climate change and to uphold sustainability in general. It constituted an important milestone which put these subjects firmly on the agendas not only of policymakers, international organisations and regulators but also of the private sector, including financial institutions.
Banks, in a predominantly bank-financed economy such as in Europe, play an essential role in financing the transformation to a sustainable economy and the transition towards a sustainable financial system. Fully aware of their responsibilities, banks are committed to using their extensive knowledge in lending, investment and smart advisory services to achieve sustainability goals for the benefit of society in cooperation with all actors along the financing chain.
As the main source of financing for households and SMEs, and as the main providers of funding to non-financial corporations and green infrastructure, banks are intensifying their efforts to integrate environmental and climate change-related considerations and risk mitigation into their risk management, strategies and decision-making with the aim of identifying further opportunities for green investments and finance. This requires an integrated approach to sustainability, with clear accountability and responsibility at the highest management level. It is a process that has already begun. Methodologies for capturing and reducing the risk stemming from climate change are under development.
Being able to describe and measure these risks in a uniform taxonomy will bring clearer understanding and will support their mitigation. The European Banking Federation supports initiatives leading to convergence and harmonisation of definitions to provide a common basis for measurement, reporting and certification, paving the way for the development of new products that could be offered on a comparable basis. The EBF also welcomes the recommendations of the FSB Task Force on Climate-related Financial Disclosures (TCFD) as a step in the right direction and supports this initiative given its relevance and expected impact.
Declaration of the European Banking Federation (continued from page 1)
Furthermore, banks are exploring the use of digital technology as a tool to support green finance in lending and investment. The potential of financial technology for sustainable development as well as raising awareness is increasing. Banks are keen to accelerate efforts to improve retail investors’ education and understanding of sustainable projects’ positive consequences so that green finance can become a part of mainstream banking business.
While banks have already undertaken steps to reduce their direct impact on the environment, their main contribution lies in providing support and financial solutions for environmentally-sound projects and companies. Given the significant needs, financing sustainable development activities should be based on diverse funding streams, both private and public. European banks are committed to working together with the public sector and other private sector actors to accelerate sustainable development and its financing.
In this context, the European Banking Federation fully supports the work of the European Commission’s High-Level Expert Group (HLEG) on Sustainable Finance, and looks forward to the group’s final recommendations that are expected in January 2018. European policymakers should seize this opportunity and build on the recommendations of the HLEG to put in place a robust, consistent and stable legal, regulatory and supervisory framework that includes specific incentives to support and enable all actors to foster green and sustainable finance in the long term.
Wim Mijs, Chief Executive Officer (Signature)
signed on behalf of the members of the European Banking Federation
Media contact:
Raymond Frenken, Head of Communications, +32 2 508 3732, r.frenken@ebf.eu
About the EBF:
The European Banking Federation is the voice of the European banking sector, uniting 32 national banking associations in Europe that together represent some 3,500 banks – large and small, wholesale and retail, local and international – employing approximately two million people. EBF members represent banks that make available loans to the European economy in excess of €20 trillion and that securely handle more than 400 million payment transactions per day. Launched in 1960, the EBF is committed to creating a single market for financial services in the European Union and to supporting policies that foster economic growth.
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