On 16 May 2018, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) published its report (dated 4 May 2018) on sustainable finance.
Among other things the report:
- calls on the European Commission to come forward with an ambitious legislative framework, recognising the proposals put forward in the Commission Action Plan on Sustainable Finance;
- calls for the introduction of European ‘carbon stress tests’ as proposed by the European Systemic Risk Board in 2016 for banks and other financial intermediaries to be able to determine the risks related to such stranded assets;
- points to the pending revision of the regulations establishing the European Supervisory Authorities (ESAs) as an opportunity to consider the role of the ESAs in investigating and developing standards for assessing carbon- and other environmental related risks, their disclosure and inclusion in the internal bank risk-assessment process while taking into account existing sustainability reporting requirements by institutions; and
- calls on the Commission to lead a multi-stakeholder process to establish by the end of 2019 a ‘Green Finance Mark’, through a legislative initiative, to be granted to investment, equity and pension products that have already achieved the highest standards in the sustainability taxonomy to guide the investment decision of those who prioritise sustainability above all other factors.