Global S&T Development Trend Analysis Platform of Resources and Environment
Finance for Europe’s low-carbon transition | |
admin | |
2022-05-25 | |
发布年 | 2022 |
语种 | 英语 |
国家 | 欧洲 |
领域 | 气候变化 |
正文(英文) | Defining green investments has been at the heart of EU legislative efforts in the sustainable finance space. What has been missing until now are the equally important policies and tools to channel finance towards companies and activities that intend to transition to a green or low-carbon economy. Given its importance, transition finance as an approach is gaining traction internationally. Transition plans are emerging as a key tool for directing capital flows toward companies seeking to transition to climate neutrality. As there are no universally accepted principles for transition plans, Europe finds itself at a defining moment to determine how they should be developed in its sustainable finance regulations. This will require clear guidelines and definitions to ensure transition plans are effective, avoid transition-washing and support businesses to finance their transition. What a transition plan isThe UK has been quicker to move on mandatory transition plans for companies. The recently established Transition Plan Task Force (TPT) that E3G co-leads the Secretariat of aims to provide recommendations for these standards to the UK regulatory processes. A key goal of the TPT is to improve the market understanding of what good practice transition plans look like. As the first step for this work, it launched a public Call for Evidence in May. The upcoming challenge for EU legislators will thus be to set up the right framework for transition finance and define the guiding principles of businesses’ transition plans. Moreover, it is critical to avoid overlaps and ensure coherence across the various EU regulations and policy instruments such as taxonomies, green bond and sustainability reporting standards. But what is already happening at the EU level? Transition plans in EU legislationThe EU is still in the initial stages of crafting its requirements for transition plans. Different EU legislative files that are currently being developed already hint toward including them. The scope and level of detail with which these plans are spelt put, however, vary significantly across legislative initiatives:
What does a good transition plan look like?As these policy developments highlight, transition plans will be embedded in various EU legislation. For such transition plans to mobilise finance effectively, they must be consistent and comparable across various sectors of the EU economy. For this to happen, robust overarching principles need to be established, as well as credible EU standards alongside guidance on specific metrics and targets. Such principles should include:
A key challenge before the EU now is getting the transition finance legislation right to avoid transition-washing and to support European businesses on their transition path. It is imperative to create the right enabling market and regulatory environment to both incentivise the financial sector to allocate capital in a smart way and incentivise the real economy to revamp its overall strategy. |
URL | 查看原文 |
来源平台 | E3G |
文献类型 | 新闻 |
条目标识符 | http://119.78.100.173/C666/handle/2XK7JSWQ/351338 |
专题 | 气候变化 |
推荐引用方式 GB/T 7714 | admin. Finance for Europe’s low-carbon transition. 2022. |
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