The creation a of well-designed Ecolabel is key to addressing the very real issue of existing national labels being granted to products that do not comply with existing investor protection and disclosure rules.
First and foremost, the Ecolabel should acquire and retain the trust of EU citizens, since they are the main source of long-term funding for the EU economy. This is a challenge given the very low confidence of EU consumers in finance as a whole. For this reason, BETTER FINANCE calls for a reassessment of the EU Ecolabel thresholds in order to ensure a high level of compliance with the expectations of individual investors and investor protections rules.
The Ecolabel needs to set the criteria for future generations of sustainable financial products that:
- Represent the reorientation of capital markets towards sustainable investments, whilst preventing any form of greenwashing.
- Have a high-level of standards with regards to thresholds, environmental / social aspects, and engagement.
- Are exemplary in complying with EU investors protection rules.
- Do not mislead individual investors with unreliable impact claims, thus preventing impact-washing.
In addition, in order to achieve a higher level of ambition and compliance with consumer expectations, the EU Ecolabel needs to also encompass criteria for impact investing. We need more financial products that quantify and measure the impact of the investment. This can guarantee that what we invest in, has an impact on the real economy.