Date: 26th July 2022
Author: BETTER FINANCE

| Original article from the FT, by Huw van Steenis, co-chair of the World Economic Forum’s finance council. |

The Russian invasion of Ukraine is yet another reason why "investors and policymakers will need to destigmatise khaki finance — encouraging the greening of “grey” industries, rather than just backing the development of the greenest-of-green technologies".

The “binary” nature of the taxonomy being rolled out in the European Union is counter-productive and will fail to encompass extremely impactful, yet imperfect, transitions to more sustainable activities. Avoiding higher emitters altogether will simply push them into the hands of less scrupulous investors that disregard sustainability matters. The taxonomy and sustainability regulations should encourage impact investing – by rewarding those companies who are serious about their transition and by pushing others in the right direction – rather than simply pushing investors to divest from anything that is not greener than green. The taxonomy and sustainability rules should evolve along with new and evolving realities, adapting to changes and requirements.

| Original article from the FT, by Huw van Steenis, co-chair of the World Economic Forum’s finance council. |