The European Union remains committed to sustainability and is coming out with two big new measures to make companies more transparent about their investments: an Ecolabel for financial products and a single EU register of ESG (environmental, social and governance) data for anything concerning sustainability or having a potential environmental impact. Three EU agencies contributed to this new move, namely the European Securities and Markets Authority (ESMA), the European Banking Authority (EBA) and the European Insurance and Occupational Pensions Authority (EIOPA), which all monitor highly sensitive areas like financial markets.
One of the initiatives involves ESG data, which is collected on a platform that provides transparency on firms that pursue Responsible Investment. These are companies that prioritise sustainability, environmental and social issues –as well as the UN's Sustainable Development Goals– alongside traditional financial objectives. The aim of the EU agencies is to establish a single European database containing all this ESG data, so as to have a public platform where data from companies, authorities, central banks and universities can be checked. Data collection will be subject to a shared guidelines, that must inevitably be based on a robust regulatory infrastructure to enable the management of risks. The intended result should provide a strong incentive for sustainable finance by providing a common data pool to draw on and a quality standard to comply with.