Citizens' call to "stop greenwashing" of finance cuts through | WWF
Citizens' call to "stop greenwashing" of finance cuts through

Posted on 05 December 2019

Investors must say whether funds are sustainable
Brussels, Belgium - 5 December 2019
Today, the EU Commission, Parliament and Council reached a largely progressive agreement on the EU taxonomy on sustainable investments. This is a step towards a cleaner financial system in Europe.
The deal follows months of discussions and disagreements between EU Member States and the EU institutions on various aspects of the taxonomy, such as whether investors would have to disclose the ranking of all their funds or only “green” ones. 
There is huge public support for a strong and science-based taxonomy: over 120,000 people have signed a petition calling for an end to greenwashing by investors.
Sébastien Godinot, Economist with WWF European Policy Office said:

"Citizens have made it clear that they don't want greenwashing of their money, and today's deal shows the EU has rightly heard them. While it's still not the full taxonomy we are calling for, it is to the credit of the negotiators that they found balanced  compromises on sticky issues like disclosure. It's now over to the Member States to approve this rapidly so the EU can start to clean up finance for good."
What elements does the deal contain (and what does this mean)?
Mandatory and separate disclosure for the share of sustainable / transition / enabling activities in financial products. ‘Transition’ means current best practice in sectors with no zero carbon alternative yet, like steel; ‘enabling’ means activities which enabling zero-carbon sectors, like wind turbine manufacturing)
This will indicate the share of sustainable / transition / enabling activities in financial products.

Disclosure for all financial products (an opt-out with disclaimer is possible for non-green ones) 
This will provide much more transparency to consumers about the degree of sustainability of each financial product. 

- A review clause by end 2021 to potentially add unsustainable activities.
This would show which investments are most environmentally harmful.

- In terms of governance of the taxonomy, it drops "Implementing Acts" that had no legal basis and gave the Member States much more influence, in favour of 'Delegated Acts' 
These give the European Commission and Parliament more power over what is included in the taxonomy

The agreement struck today now goes to EU permanent representations of Member States to be formally approved.

Sébastien Godinot
Economist, WWF European Policy Office
+32 489 46 13 14

Sarah Azau
Media Manager, WWF European Policy Office
+32 473 57 31 37
Citizens are calling for an end to greenwashing in the finance sector - the EU taxonomy can help.
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