Banking and Payments Federation has responded to the European Commission’s (EC) public consultation on its renewed sustainable finance strategy.
The response highlighted the need for EU policymakers to move focus from sustainable investment to sustainable banking, considering the role banks play in funding the EU economy.
To help drive the greening of the economy, attention at EU and national level should also be given to the creation of incentive structures, in particular around subsides to support SMEs moving towards sustainable products/investments.
For the transition to be successful, however, BPFI believe that better quality data is required across economies and sectors. Only by having comparable and high-quality data can banks, as financial intermediaries, really understand environmental risks.
On top of this, all reporting requirements on banks should be harmonised to help with comparability and reduce administrative burden.
The European Commission should also explore developing “green” frameworks for other types of capital market funding instruments, such as securitisation.
By having a standardised framework, this could support Irish and EU market participants developing innovative products for investors geared towards environmentally sustainable products.
For further information on BPFIs position please see the final response here.