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Behind the scenes - accelerating transparency in sustainable finance
Lina Norder, Sustainable Finance Specialist at SEB, takes the readers behind the scenes of the work done within the EU Platform on Sustainable Finance. An advisory group to the European Commission, it gathers industry experts to contribute to better policy and regulation. SEB is the only bank represented.
The way sustainable finance has developed on a purely voluntary basis is remarkable. When we talk about “thought leadership” in sustainability at SEB, one example of what we mean is producing the innovative solutions that helped establish the sustainable finance market (such as the green bond) and that keep developing it.
Tina Norder, Sustainable Finance Specialist at SEB
Beyond merely good ideas, thought leadership implies that such ideas have an impact on the thoughts or behaviour of others. It was in the spirit of this ambition that SEB applied when the European Commission called for experts to an advisory group, the EU Platform on Sustainable Finance.
Given the massive growth of sustainable finance in recent years, the need for increased transparency, comparability, and data was recognised by many. The Platform was therefore tasked with first creating, and then expanding and improving, the EU Taxonomy (a classification system of green activities and accompanying disclosure requirements). It is also a key advisor on other major sustainable finance initiatives*.
As SEB is the only bank represented on the Platform, we try to ensure that the perspectives of the banking sector as a whole are taken into account, which we hope leads to balanced and more well-anchored policy.
Contributing to this work, and our engagement in the development of policy, also means that we expand and deepen expertise that we can pass on to our clients. Being part of these discussions “behind the scenes” gives us a better understanding not only of how the regulations work, but also of why regulation turned out the way it did, as well as of the sense of political direction. In addition to being exciting topics to follow closely, this enables us to be a better speaking partner to our clients.
Contributing to levelling the sustainable finance playing field is another important outcome of the Platform work. Financial market actors have different thresholds and methods for classifying something as green. The increased transparency and standardisation that is worked out in this context lead to better comparability, which allows the market to distinguish green initiatives from greenwashing more easily.
And last but not least, by bringing the perspectives of our clients and our own experiences as a bank to the table, we try to ensure that policy is anchored in how things work in practice. It is sometimes challenging to find compromises that all can agree on, with the participating organisations bringing highly diverse perspectives to the table. However, we believe that our participation contributes to making policy more workable in practice, while safeguarding the environmental integrity of the frameworks.
So, what’s next on the EU Platform on Sustainable Finance (PSF)?
Current projects on which SEB will give input include the development of new EU Taxonomy activities, as well as work on transition plans. Our main focus is on developing a methodology to monitor capital flows to sustainable investments. This lays the groundwork for a first stocktake of the extent to which capital flows are going in the direction needed and will become an indispensable tool for future policymaking. The release of the first draft of the methodology Monitoring Capital Flows to Sustainable Investments: Intermediate report (pdf) from PSF was one of the highlights of the work so far.
Contributing to this type of public-private sector dialogues is one of many ways in which we try to act as a thought leader. It expands our sustainability efforts throughout the financial sector and complements the direct role we play in our own client relationships. This shows the diversity of possible means that support our ambition to be the best possible partner to our clients – in their green transition journeys and beyond.
*such as the Sustainable Finance Disclosure Regulation (SFDR) and the Corporate Sustainability Reporting Directive (CSRD).
Transition Reflections: Personal insights into sustainability development
In a series of articles – Transition Reflections – SEB’s experts share insights and reflections on significant sustainability developments and topics. Lina Norder is a Sustainable Finance Specialist at SEB. She is also part of an expert advisory body to the European Commission. The group was initially tasked with first creating, and then expanding and improving, the EU Taxonomy (a classification system of green activities and accompanying disclosure requirements), and also advices on other sustainable finance topics.
