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We need substantial investments to reduce our economic activities' impacts on the environment and climate. Sustainable finance is about making sustainability considerations an integral part of financial policy and decision-making with the aim to re-orient and scale up public and private investments towards meeting sustainability goals.
EEA's work on sustainable finance
The EEA has contributed to the design of EU sustainable finance policy through active participation in and input to several expert groups assisting the European Commission in its work on the Action Plan on sustainable finance and its components such as the EU Taxonomy.
The EEA is a permanent member of the Platform on Sustainable Finance, formed under the EU Taxonomy Regulation advising the Commission on the development of the EU Taxonomy and on the implementation of the Sustainable Finance Framework.
The EEA also contributes to the first European Sustainability Reporting Standards and is an observer to the European Financial Reporting Advisory Group (EFRAG) — Sustainability Standard Board.
In addition, the EEA works together with international partners (such as the OECD) and regularly provides information on sustainable finance such as the Green Bond Indicator that is published once a year as part of the monitoring of the implementation of the 8th Environmental Action Programme.
What is the EU Taxonomy for sustainable activities?
The EU Taxonomy is a classification system, providing companies, investors and policymakers with appropriate definitions for which economic activities can be considered environmentally sustainable. It aims to create security for investors, protect private investors from greenwashing, help companies to become more climate-friendly and help shift investments where they are most needed.
The Taxonomy Regulation establishes six environmental objectives:
- climate change mitigation;
- climate change adaptation;
- the sustainable use and protection of water and marine resources;
- the transition to a circular economy;
- pollution prevention and control;
- the protection and restoration of biodiversity and ecosystems.
While contributing significantly to one of those objectives, an activity should not do significant harm to any of the others.
Interview — European Investment Bank and sustainable finance
The European Investment Bank (EIB) is the EU’s financing arm. It fosters sustainable growth within the EU but also globally. We are firmly committed to sustainable development and that is anchored in our statutes and our policies, such as the Climate Bank Roadmap and the Environmental and social sustainability framework, and also in the way we have adopted sustainable finance as our operating model for all our activities.
The big global policy frameworks we aim to operationalise, within our remit as a public bank, include the Sustainable Development Goals, the Paris Agreement on climate change, and what will hopefully be the post-2020 biodiversity framework.
We interviewed Eva Mayerhofer, lead biodiversity and environment specialist at the EIB, about the challenges and opportunities of accelerating Europe’s green transition through sustainable financing.