EU policy and regulations for ‘switching’ the financial system to sustainability

The “Sustainability” became a symbol of world’s wealth and growth and a guiding goal for prosperity in economic and financial aspect. This evoked changes in the investment approach, which started to consider also non-financial factors such as ESG when portfolio assets allocate and manage. On the EU scene the active “switching” to sustainability is incorporating in the policies and legislative framework, accompanied by financial regulations to involve sustainable investments and private finance for supporting the achievement of the sustainable goals. By the growth strategy - European Green Deal, set out in December 2019, was declared the aspiring goal Europe to become “the first climate neutral continent by 2050”. This ambition commits huge public and private financial resource and priority measures towards: setting an EU sustainability taxonomy and investor duties for long-term horizons and ESG incorporation into investment decisions; reforming the disclosures; retail investors access to sustainable finance opportunities; creating standards for related financial assets, also merging the sustainability in the governance and financial supervision of the financial institutions. All priorities are under active elaboration as the first one – the Taxonomy regulation, is a fact since June 2020 and supplies with a framework to facilitate sustainable investment. Some of these tools are expected to support a 'resilient, sustainable and fair' recovery from COVID-19 pandemic. A theme to watch and understand, crucial for the EU and the world and driving the finance system to sustainable investments.