German NGOs call for coherent EU sustainable finance approach to support Green Deal
Clean Energy Wire
The German environmental umbrella organisation DNR is calling for a comprehensive restructuring of financial market regulation to pave the way for an effective implementation of the European Green Deal. Ahead of the European Sustainable Finance Summit on 28 September in Germany's financial centre Frankfurt am Main, DNR president Kai Niebert said a sustainable and climate-friendly transformation of the European economy could only work with a "smart and well-grounded funding that ensures no money is put into subsidies that harm the environment and the climate." Niebert said "every euro invested" in the EU would have to contribute to the Green Deal's implementation, while contradicting subsidies had to be erased altogether. "The money needs to flow into tomorrow, not into yesterday," Niebert said. The EU is currently debating its long-term budget, as well as its coronavirus pandemic recovery fund. At the same time, the European Commission and the German government are both working on new regulations to anchor sustainable practices in investment and lending activities, including a European taxonomy meant to classify financial flows according to their environmental and social impact. The DNR said the taxonomy could serve as a "standard" for tying state support to political goals, such as emissions reduction. The classification system therefore would be needed quickly and should not be finished any later than December this year as planned, and be accompanied by a "do no harm" principle that bans the funding of detrimental activities.
The European summit is hosted by Green and Sustainable Finance Cluster Germany (GSFCG), an alliance of financial institutions that aims to achieve a concerted adoption of sustainable finance principles. As Germany currently holds the EU Council's rotating presidency, the speakers, finance minister Olaf Scholz and environment minister Svenja Schulze, are expected to also address the European sustainable finance strategy, which according to the banking industry needs to prevail over any national strategy in order to maintain equal market conditions across the EU.