The effectiveness of sustainable financing requires simplification

The EU’s 2018 financing plan emphasized the control of capital flows, but reporting alone is not enough. Pricing, taxes and subsidies are also needed to focus on sustainable targets. The regulatory authorities should focus on the essential indicators and provide clear signals to encourage the real economy. The Emissions Trade System (ETS) is a good example of this.

Although the above changes are good, I am concerned about the proposed amendment to the Corporate Responsibility Directive (CSDDD), which would limit the reporting obligation to only direct suppliers. Human rights violations often take place in a deeper supply chain, and regulation should not be impaired at this point.

The regulatory authorities should focus on fewer but more significant indicators and large companies, while providing clear political signals. This plays a key role in led the capital flows to genuinely more sustainable solutions and support long -term sustainable development.

Samu Slotte

Director, Sustainable Financing, Danske Bank