European Commision publishes Strategy for Financing the Transition to a Sustainable Economy

The European Commission published its long-awaited Strategy for Financing the Transition to a Sustainable Economy (the Strategy) on 6 July 2021

The Strategy was announced as part of the European Green Deal in 2019 (originally billed as the “Renewed Sustainable Finance Strategy”). It is less comprehensive in terms of new concrete actions than the 2018 Sustainable Finance Action Plan (the 2018 Action Plan). However, the Strategy seeks to cast its net wider than its predecessor, with more focus on issues beyond climate, a broader range of products in scope and an eye to the international stage.

The Strategy is stated to be based around four main issues:

• Financing the transition to sustainability: focusing particularly on the transition of the whole economy to implement climate and environmental objectives.
• Inclusiveness: increased access to sustainable finance opportunities for individuals and small and medium-sized enterprises (SMEs).
• Financial sector resilience and contribution: how the financial sector can contribute to the European Green Deal targets, become more resilient and combat greenwashing.
• Global ambition: fostering of international consensus on sustainable finance.

The Strategy is a mixture of new actions and restatements of work already in progress. We discuss the key actions in an article on our website.