The European Commission’s (EC) High-Level Expert Group on Sustainable Finance (HLEG) initiated a questionnaire following the publication of the interim report on sustainable finance, to which PensionsEurope also provided its input.
The purpose of the HLEG is to deliver recommendations to the EC on how to:
- ‘better integrate sustainability considerations in the EU's financial policy’;
- ‘mobilise capital [...] to finance sustainable investments’; or
- how to ‘identify the steps that financial institutions and supervisors should take to protect the stability of the financial system’.[1]
The Questionnaire on Sustainable Finance Interim Report, to which BETTER FINANCE submitted an answer, is designed to acquire feedback from stakeholders in the industry and serve as basis for the final report to be submitted to the EC.
PensionsEurope, an expertise group in the financial services sector also submitted an answer to HLEG’s questionnaire, highlighting that ‘pension funds have the purest approach to long term/sustainable investment’, IPE reports.
In its answer, PensionsEurope motivates that pension funds are able to integrate sustainability in the funds’ risk-return policy since they can invest into ‘asset classes that are not accessible to short-term investors, such as illiquid, private assets’.[2]
In connection to this question, BETTER FINANCE’s answer indicated that i) long-term and ‘pension savers be recognised as major stakeholders’, insofar as they should benefit also from a ‘fair share of rewards’ and better transparency in terms of costs and fees ; 2) EU financial policy should be more focused on the clarity and fairness of information provided to savers, whereas ESG and SRI labels should be more stringently supervised.[3]
With regard to green bond standards and labelling, PensionsEurope responded that the Green Bonds Principles (GBP) should be applied in order to ‘initiate a benchmarking platform to compare standards and create transparency’, so that the EU can ‘ensure high-quality standards and labels that avoid misuse/ green-washing’.[4]
In its submission to the HLEG, BETTER FINANCE claims that the EU financial framework should provide for ‘[g]reen bonds and sustainable assets that first of all apply ESG criteria to their own activities’ and that are ‘exemplary in terms of compliance with EU consumer and investor protection rules, in particular information and disclosure ones’.
Read also BETTER FINANCE’s news item on Green Bonds as a Vehicle for Sustainable Finance.
[1] Sustainable Finance, European Commission website, High-Level Expert Group on Sustainable Finance, available at www.ec.europa.eu/info/business-economy-euro/banking-and-finance/sustainable-finance_en .
[2] PensionsEurope’s answer to Question 1 of HLEG’s Questionnaire.
[3] BETTER FINANCE’s answer to Question 1 of HLEG’s Questionnaire.
[4] The second part of Question 3 of the HLEG’s Questionnaire on Sustainable Finance.