As Brussels powers back up after the summer break, and with the European Commission beginning to take shape, there have been some key developments in sustainable finance regulation over the past 10 days.
CSRD
The European Commission has fired warning shots at 17 member states over their failure to meet the July deadline for transposing the Corporate Sustainability Reporting Directive (CSRD).
In a letter to countries including Germany, the Netherlands, Spain, Austria and Belgium, the Commission argued that investors would suffer as a result of the tardy approach to adopting the disclosure rules into national law.
“In the absence of transposition of these new rules it will not be possible to achieve the necessary level of harmonisation of sustainability reporting in the EU, and investors will not be in a position to take into account the sustainability performance of companies when making investment decisions,” it said.
The German justice minister suggested at the end of September that CSRD should be renegotiated before any transposition takes place, but it is unclear how much support his position has from his colleagues in government, or elsewhere.
Taxonomy
In another sign of political pushback against the sustainable finance agenda under the new college, recommendations to rewrite parts of the European Union Taxonomy have been taken up by the finance heads of Germany, Italy and France.
The group advising the German government on sustainable finance published a report over the summer, proposing an overhaul of the Green Asset Ratio (GAR) rules, so that the calculations for green lending are more accurate.
GAR rules apply to banks, but there are equivalent requirements for insurers and investors in the Taxonomy Regulation, and there are campaigns to get those changed too.
Germany’s secretary of state for finance and European policy, Heiko Thoms, and the directors general of the French and Italian treasuries, Bertrand Dumond and Riccardo Barbieri, wrote to the Commission telling them to address climate and transition in a “more realistic” and “coherent” way in sustainable finance policies, including changing GAR.
People
IPE broke the news back in June that the Commission’s head of sustainable finance, Martin Spolc, would be replaced by Didier Millerot. At the time, the Commission wanted to put Spolc at the helm of digital assets instead, but he announced last week that he would keep working on sustainability, leading on adaptation and resilience within the Commission’s climate unit.
MEPs will grill incoming commissioners about their priorities and intentions on 4 November, it has been confirmed. Ursula von der Leyen selected who she wanted to oversee the next five years of lawmaking last month, but the candidates must face questioning by Parliament before they can be signed off.
In a draft document seen by IPE, the Parliament’s Committee on Economic and Monetary Affairs outlined its questions for Maria Luís Albuquerque, the former Portuguese finance minister expected to take the reins on EU financial services. They include how she plans to strengthen the sustainable finance agenda while reducing the administrative burden and making it more usable.
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