Response to the Commission on the renewed sustainable finance strategy

FESE fully supports the Commission’s Sustainable Finance agenda aimed at reorienting capital flows into sustainable investments and managing financial risk related to climate change, as well as fostering transparency and long-termism in financial and economic activity. It is important to ensure that all capital market raising activities adhere to sustainable financing so that all companies can be part of the necessary transition towards a sustainable future for our planet.

We support the aim of developing a long-term sustainable finance vision which ensures a level playing field between public and private markets and is built on a solid understanding of the role of financial markets. In particular, how it can facilitate the transition towards a low-carbon future and not lead to unintended consequences for market players in terms of risk management. A transparent and consistent approach, in line with ESG aspects, by financial industry and regulators holds great opportunities for international capital markets, both in the area of risk assessment and for the identification of new business areas. It does, however, require a long-term vision that is proportional to company size and ensures a level playing field between public and private markets. The alignment of different pieces of legislation is a prerequisite. A clearly defined taxonomy, whereby agreement on what constitutes environmentally sustainable assets is found, is a necessary starting point for other actions, such as standards and labels. This will also allow high quality and comparable financial disclosures.