Shades of green: financial standards
Deciding whether a project is environmentally friendly can be tricky, but an initiative on green financial standards could facilitate the process, writes Elisabeth Jeffries
Is hydropower environmentally friendly or not? That question, dividing investors integrating environmental, social and governance (ESG) factors, is about to be answered – with far-reaching effects on sustainable finance.
The inconsistency in ESG investing could change now that the Green Finance Taskforce has published its findings in its report, ‘Accelerating Green Finance’, which came out in March. Among many issues, the taskforce – formed by the UK’s Department for Business, Energy and Industrial Strategy (BEIS) in 2017 – considered a set of innovative green financial standards, which could include green investment labels and a green financial classification (taxonomy). These could specify the status of hydropower, for example. A key question is whether the taskforce’s recommendations will activate tighter ...