The European Supervisory Authorities (ESA), which represent the three supervisors of the European financial sector (EBA, EIOPA and ESMA), are keen to gain a better understanding of the phenomenon of greenwashing. A call for evidence has been launched to gather the views of banks, insurers and markets on the subject.
Strengthening regulation of sustainable finance in Europe
The three European agencies responsible for overseeing finance have asked institutions, NGOs, consumers and researchers to gain a better understanding of the phenomenon of greenwashing. This call for evidence is motivated by the need to complete and strengthen regulations on financing the energy transition.
EIOPA is seeking input from stakeholders to better understand the key features, drivers and risks associated with #greenwashing. 🏭-> ♻️- EIOPA 🇪🇺 (@eiopa_europa_eu) November 16, 2022
🗓️ Share your views with us until January 10 by responding to the below survey 🔽https://t.co/TNb7Oeq0cI#sustainability #sustainablefinance pic.twitter.com/acJqAUfrCe
🟢 #ESAs Call for Evidence on #greenwashing → https://t.co/jGiKSU2N3n.- ESMA - EU Securities Markets Regulator 🇪🇺 (@ESMAComms) November 16, 2022
🗓️ Jan. 10, 2023
🌱 understand features, drivers + risks
🌱 collect examples of practices
🌱 find practices relevant to segments of the sustainable investment value chain + financial product lifecycle pic.twitter.com/lFWjuDC0fN
🌿#ESAs launch joint Call for Evidence on #greenwashing👇- EU Banking Authority - EBA 🇪🇺 (@EBA_News) November 15, 2022
🔷to gather input from stakeholders on how to understand the key features, drivers, and #risks associated with greenwashing and to collect examples of potential greenwashing practices.
" More research and a common understanding " of greenwashing in finance are " necessary ", reported the European executive in its mission statement published last May.
It has to be said that current regulation of sustainable finance in Europe remains incomplete and widely criticized.
To accelerate investment in low-carbon economies, Robert Ophèle, Chairman of the Autorité des marchés financiers (AMF), identified three priorities in a speech earlier this year:
- mobilizing French people's savings to finance companies' equity capital;
- greater visibility and credibility for sustainable investment;
- a strengthening of the European regulatory framework.
On this last point, the AMF is awaiting the European regulation of activities in digital assets (MICA), which will notably provide a framework for the crypto-currency environment. If discussions between the Parliament, the Council and the European Commission come to a swift conclusion, the agreed rules will come into force in 2024. The AMF Chairman's criticisms also focus on the European green taxonomy, which remains unfinished, as do non-financial accounting standards.
Backlash against banks
The fight against greenwashing intensifies. On May 31, Deutsche Bank was raided by German police as part of an investigation into suspected deception linked to the ESG rating of some of its investment products. This mark is supposed to certify to investors that they are placing their money in funds that respect environmental, social and governance criteria. The investigation began on the basis of information gathered and accusations by a whistleblower that the German asset manager had wrongly classified products as "sustainable" investments.
Searches at Deutsche Bank, suspected of "greenwashing" in Germany.- Le Monde (@lemondefr) May 31, 2022
👉 The company is suspected of inflating the size of its investments meeting ESG (environmental, social and governance) criteriahttps://t.co/zqKVxXnXPg
Proof that impunity in green communications seems to be coming to an end, three weeks before COP 27, HSBC received a warning from the UK's advertising watchdog prohibiting it from using posters deemed "misleading" on which the bank highlighted its commitment to the fight against climate change.
Greenwashing is now taken seriously by investors, as the slightest doubt can trigger spectacular stock market movements.
🌍 Greenwashing: HSBC has received a warning after using posters deemed "misleading" that highlighted the bank's commitment to fighting climate changehttps://t.co/40ng0w3dMJ- Les Echos (@LesEchos) October 19, 2022