EU action plan on green finance elicits doubts from German finance industry

The European Union’s action plan on making the financial industry more sustainable has raised doubts in Germany’s financial industry as some fear it may curtail the autonomy of investors, Ingo Narat writes in Handelsblatt. While the plan’s central idea to apply sustainability criteria to different investments and rank them accordingly is “right in principle,” it is very difficult to develop these criteria in a fully transparent and comprehensible manner, says Julia Backmann of the German Investment Funds Association (BVI). Like others in Germany’s financial industry, she fears sustainability criteria ultimately could overrule profitability considerations, meaning that “investors and fund managers will be told what to invest in and what not to invest in,” Backmann says.