Saturday, 07 December 2019
The European Parliament on Thursday agreed on a list of officially recognised sustainable investments.
The agreement is the result of weeks of difficult negotiations. “We have reached a compromise on a ‘green list’ of sustainable economic activities. This is a major success with regards to COP25 and for our sustainable finance strategy,” the European Commission’s vice-president Valdis Dombrovskis said in a tweet.
In the absence of a European classification system to define what is considered a sustainable economic activity in environmental terms (‘taxonomy’), the European Commission submitted a proposal for new directives in May 2018.
“We have created a new basis to make the finance market more environmentally friendly,” said French MEP Pascal Canfin, president of the European Parliament’s Environment Commission.
The idea is to better orientate private investments towards sustainable economics, while avoiding ‘green-washing,’ the commercialisation of financial products wrongly classified as ‘green’ or sustainable.
The agreement also includes additional transparency: investors will be able to see what percentage of their financial product is really sustainable, says Dutch MEP Bas Eickhout.
The agreement includes an obligation to declare non-sustainable products as well. Eickhout says investors should be told if a financial product is not on the new European list.
“These new rules will guarantee that investments in nuclear, gas and coal energy will not be considered sustainable,” Eickhout explained. These sectors were put forward as suggestions by France, Germany and Poland respectively.
The agreement also asks that the European Commission submit a proposed list of high-polluting investments in 2021.
The new agreement still has to be endorsed by the permanent representatives of the member states, then approved by the co-legislators (Parliament and Council).
The World Wildlife Fund (WWF) has expressed satisfaction about the agreement. “The general public have expressed a lot of support for strong taxonomy that is based on scientific data: more than 120,000 people signed a petition calling for an end to greenwashing,” the NGO said.
The Brussels Times