UK and France put Brexit differences aside to kill EU green finance deal
Today EU governments blocked the most progressive piece of financial legislation in the world: new rules for which financial investments can be labelled environmentally sustainable. Green transport group Transport & Environment (T&E) said the decision by national ambassadors to re-open the draft law agreed with MEPs is a victory for the finance lobby and national short-sighted interests and a setback for the transition to a cleaner economy.
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Under pressure from France and the UK, ambassadors want to go back to the negotiating table. The UK, France, Czechia, Hungary, Poland, Slovakia, Romania, Bulgaria, and Slovenia agreed on killing the deal which was reached with MEPs and the European Commission just last week. However, the European Parliament is expected to stand firm, particularly over scope and governance to ensure the law impacts all financial products and that the definition of “green” is science-based.
Luca Bonaccorsi, director of sustainable finance at T&E, said: “Today governments have ignored the call of more than 120,000 citizens and lost an opportunity to approve a great piece of legislation on green finance. The negotiations on the taxonomy regulation will continue with the sole intent of weakening the new rules. Governments such as France and the UK need to be exposed for paying lip service to climate action at the Madrid COP while blocking a law that would drive the clean investment we need.”
The draft regulation is intended to set a legal framework for the EU’s taxonomy of environmentally sustainable activities that is based on scientific evidence rather than political compromises. It would cover all investments and require the financial sector, including fund managers, the issuers of bonds and listed companies, to disclose how green their investments are.