171026 Niall Bohan

So, how do we create a financial system that supports the sustainable development of the European Union?

That’s what an audience of more than 70 capital market participants, policy-makers and State agencies gathered in Dublin on Thursday (26/10) to learn about.

Sustainable Nation Ireland hosted Niall Bohan, Head of Unit, DG FISMA European Commission, who is responsible for the High-Level Expert Group on Sustainable Finance. Niall set out the policy context, challenges and opportunities in creating a financial system that supports the sustainable development of the European Union.

It was a real positive to have Niall travel to Dublin and present on his work in Europe. He began with highlighting the fact that over the next two decades, Europe needs €180 billion in additional yearly investment, notably in clean energy, to keep the increase in global temperature below 2 degrees Celsius.

It is a major challenge, but also an opportunity.Re-orientating public and private financial flows towards green and sustainable efforts can help mitigate the risks posed by climate change. It can create new jobs and stimulate sustainable economic growth in the process.

In December 2016 the Commission formed a High-Level Expert Group (HLEG) on Sustainable Finance to help ‘hardwire’ sustainability into EU financial policy. As outlined by Niall, the EU High-Level Expert Group interim recommendations can be summarised as:

  • A classification system for sustainable assets to build trust in green and sustainable asset classes
  • A European standard and label for green bonds and other sustainable assets, as well as labels for sustainable funds;
  • Fiduciary duty that encompasses sustainability: clarify that managing ESG risks is part of fulfilling fiduciary duty;
  • Disclosure by firms and financial institutions of material information on sustainability issues should be further strengthened;
  • Include sustainability considerations in impact assessments of upcoming legislation;
  • Improve advisory on sustainable infrastructure investments and facilitate private capital flow;
  • Integrate climate and wider sustainability risk assessment and supervision in ESAs’ mandates;
  • Unlock investments through review of Eurostat’s public sector accounting standards for energy efficiency investments involving private companies (Energy Service Companies/ ESCOs).

Following Niall’s presentation, Sustainable Nation moderated a panel discussion on the area which included Niall; Paul Ryan, Director IFS 2020 Strategy, Department of Finance and Eoin Fahy, Chief Economist and Head of Responsible Investment KBI GI.

With the EU’s High-Level Expert Group final report due in January 2018, the Commission has committed to build on the report’s findings. Under the recently published Commission Work Programme 2018, it will develop an Action Plan on sustainable finance with regulatory measures in Q1 2018.

With €28 billion in green finance related activities already underway in Ireland across green UCITS funds, green infra funds, listed green equities and listed green / climate aligned bonds, Ireland already offers a unique blend of expertise and proven experience in this area, and it is growing at a fast rate.

Under government’s IFS 2020 Strategy, Sustainable Nation Ireland is tasked with the promoting and positioning of Ireland as a green finance hub, while raising awareness of the responsible investment agenda.

For more information about Sustainable Nation Ireland’s green finance and responsible investment activities please visit –https://www.sustainablenation.ie/sustainable-finance

This leadership event was supported by the Sustainability Skillnet and leading Irish legal firm McCann Fitzgerald.

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