https://commission.europa.eu/business-economy-euro/banking-and-finance/sustainable-finance_en

https://www.esma.europa.eu/sites/default/files/library/sustainable_finance_-_implementation_timeline.pdf

The plan aims to redirect capital flows towards sustainable investments and projects, and to integrate sustainability considerations into investment decisions.

So far, the EU Action Plan on Sustainable Finance has already implemented several measures, such as the establishment of a classification system for sustainable economic activities, known as the EU Taxonomy. This taxonomy provides a common language for investors to identify which economic activities can be considered sustainable, and helps to prevent greenwashing.

(1) The EU Taxonomy

In addition, the plan has introduced disclosure requirements for financial institutions, requiring them to disclose how they integrate sustainability risks into their decision-making processes.

(2) The new European Sustainability Reporting Standard (ESRS)

The plan also encourages the development of sustainable finance products and services, such as green bonds and loans, and provides guidance on how to integrate climate and environmental risks into investment decisions.

(3) European Green Bond Standard (EUGBS)

(4) Proposal on the green labeling for financial products

To implement the new regulation on sustainable financing, European banks will need to adapt their investment strategies and risk management frameworks to integrate sustainability considerations. They will also need to disclose how they integrate sustainability risks into their decision-making processes. This will require banks to collect more data on the environmental and social impact of their investments, and to analyze this data to identify potential risks and opportunities.