For its second year, the Observatoire de la finance durable is exporting internationally with the launch of the One Planet Data Hub.
<!u002du002d wp:paragraph u002du002d>One year after its launch, theObservatoire de la Finance durable (Sustainable Finance Observatory ) is enriched by integrating a follow-up of financial players’ commitments to sustainable finance and thanks to the updating of indicators for monitoring the transformation of financial practices and flows. This Observatory, co-piloted by the industry federations, Finance For Tomorrow and Paris Europlace, was announced as part of the marketplace declaration of July 2, 2019 and launched on the occasion of Climate Finance Day 2020. It reports on the achievements and actions of the Paris financial marketplace’s stakeholders in green and sustainable finance for the insurance, banking, private equity, asset management and specialist sectors.<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph {‘style’:{‘color’:{‘text’:’#14233c’}}} u002du002d>
UPDATE OF SUSTAINABLE FINANCE KEY FIGURES
<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph u002du002d>The ‘Transformation of financial practices and flows’ section of the Observatory, which publishes data aggregated by financial activity, presents the key sustainable finance figures for the Paris marketplace for 2021, 2020 and 2019. This historization of the data allows us to see the evolution of players, practices and financial flows over these first two years, and will be enriched over the years. Data collection was carried out with the support of professional federations and associations. Visual improvements have also been made to the data publication, to enhance the readability of the graphs and add an educational dimension to the tools.<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph u002du002d>Some key figures from the Observatory:<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph u002du002d>Investments and financing contributing to the transition :<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:list u002du002d>
- Insurance (FFA) :
- €114 billion in green investmentsat the end of 2020, i.e. 5.4% of total assets managed by French insurers, including €43 billion invested in green bonds.
- 73.6 bn in unit-linked products with a responsible, green and/or socially responsible label by the end of 2020, i.e. 17% of total unit-linked assets.
- Banks (FBF) :
- 200 bn in green loans and credits by 2020, including €44 bn in loans to finance renewable energy infrastructures
- Private equity companies (France Invest):
- In 2020, €1.2 billion invested in Cleantech, including €314 million in renewable energies;
- Asset management companies (AFG):
- SRI label: €603 billion in assets under management in 786 funds managed by 147 management companies (as at 24/10/2021).
- 1,587 billion in Responsible Investment assets under management (considered as article 8 and 9 according to SFDR regulations)
- Specialized financing institutions (ASF):
- Financing of hybrid and electric vehicles for private customers will reach nearly €1.5 billion in 2020.
<!u002du002d /wp:list u002du002d> <!u002du002d wp:paragraph u002du002d>Coal exposure :<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:list u002du002d>
- Insurance: €16 billion of exposure to thermal coal by the end of 2020, i.e. 0.8% of assets under management.
- Asset management companies : €13 billion of assets exposed to coal in 2020, i.e. 0.36% of assets under management.
- Banks: €2.1 bn coal exposure, i.e. 0.16% of banks’ corporate loan portfolios.
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MONITORING AND DECIPHERING INDIVIDUAL COMMITMENTS
<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph u002du002d>By 2021, the Observatory has identified over 1,300 public commitments, involving 370 voluntary players. <!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph u002du002d>For 2021, several new features have been added to the individual commitments section:<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:list u002du002d>
- A guide to commitments has been drawn up in coordination with supervisors to specify the expectations of the exercise, the rules for publishing commitments, and the minimum criteria expected to ensure the proper structuring and completeness of the information. All commitments are now analyzed to verify their compliance with these criteria.
<!u002du002d /wp:list u002du002d> <!u002du002d wp:paragraph u002du002d>Details of the minimum criteria: A well-structured commitment, and therefore considered compliant, must concern an environmental, social or governance (ESG) issue, clearly specify the financial assets concerned and the scope of its action, be part of a timetable and have a clear objective. If a commitment does not meet these minimum criteria, it is identified as ‘Non-compliant’.<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:list u002du002d>
- The individual commitments section has been enriched with commitment tracking. Players who have communicated a source of public follow-up on their commitments are identified on the site.
- Last but not least, an analytical view of commitments is now available thanks to reading grids. This makes it easier to understand individual commitments by deciphering their content and scope.
<!u002du002d /wp:list u002du002d> <!u002du002d wp:paragraph u002du002d>These commitments are updated on an ongoing basis, and financial players who have not yet signed up are invited to join the initiative.<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph {‘style’:{‘color’:{‘text’:’#14233c’}}} u002du002d>
THE OBSERVATORY’S SCIENTIFIC AND EXPERT COMMITTEE
<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph u002du002d>The Observatory’s Scientific and Expert Committee, an independent body ensuring the scientific rigor of the project, issued two sets of recommendations this year. The first, in February, concerned coal and the Observatory’s indicators, and the second, in September, concerned non-conventional fossil fuels and alignment strategies. The first series of recommendations gave rise to exchanges with industry federations and to changes to the Observatory, notably in the detail of the coal policy value chain and in the perspective of the data on the Observatory website. The second series of recommendations will be analyzed for the next financial year.<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph {‘style’:{‘color’:{‘text’:’#14233c’}}} u002du002d>
A PILOT PROJECT FOR THE ONE PLANET SUMMIT
<!u002du002d /wp:paragraph u002du002d> <!u002du002d wp:paragraph u002du002d>The One Planet Summit is today announcing the launch of the One Planet Data Hub, which aims to encourage transparency in all economic and financial sectors, and which will serve as a global synthesis to make the monitoring and real impact of commitments easier to understand. The French Observatory will contribute to this. Supported by the FC4S network of green financial centers, the Observatory is already in its second year of achieving the dissemination objective set for it by the European Union as part of the LIFE grant. The Observatory will also be promoted at COP 26.
Thierry Déau, Chairman of Finance For Tomorrow and CEO of Méridiam, commented: ‘Finance for Tomorrow is proud of the work and publications of the Observatoire de la finance durable and its scientific and expert committee. With the monitoring and deciphering of commitments, in just one year we have taken two steps forward towards achieving the objectives set out in the marketplace agreement, and ensuring transparency in the transformation of the financial sector!’
Bruno Le Maire, French Minister for the Economy, Finance and Economic Recovery , declared: ‘The Observatory launched by the Paris marketplace represents a significant step forward in defining a marketplace strategy for sustainable finance. It is at the origin of an essential exercise in transparency of financial data on climate issues. This pioneering initiative should serve as an example for the One Planet Data Hub whose launch we are announcing today!’