Within the PARC Foundation, the Observatoire de la finance durable internationalizes monitoring and transparency for the ecological transition.
At the start of 2024, the Observatoire de la finance durable (OFD) will join the new Paris Agreement Research Commons (PARC) foundation. Within this new entity, the Observatoire will merge by the end of 2024 with the Climate Transparency Hub (CTH) to become the reference platform for monitoring and transparency in the ecological transition in finance, as well as a lever for the international dissemination of this work.
The PARC foundation, housed within the Fondation du Risque (FdR) and backed by the Institut Louis Bachelier (ILB), and created in coordination with the Direction Générale du Trésor, aims to improve methodologies for monitoring the Paris Agreement and to stimulate the ecosystem of research and data on green finance.
This foundation will benefit from the complementary nature of the CTH and the Observatoire de la finance durable. The newly-created platform will concentrate both the collection and centralization of data relating to financial players, hitherto carried out by the CTH, and the provision by the Observatoire of the data and analyses required to monitor the transformation of financial practices, including the tracking of players’ individual commitments. ADEME will be involved in the governance of the new platform, as a funder and founding member of the PARC foundation, while the Observatory’s current role of disseminating and promoting financial market data will be taken over by the Institut de la finance durable.
These activities will continue to be carried out in conjunction with the project’s partner professional federations: the Fédération Bancaire Française, the Association Française de la Gestion Financière, France Assureurs, France Invest and the Association Française des Sociétés Financières, in keeping with the Institute’s missions and its role as a driving force behind the transition of the financial marketplace.
The Institut de la Finance Durable will also remain in close contact with the Observatoire as part of its new responsibilities, through participation in its governance. It should be noted that the governance framework will comprise 7 colleges (financiers, investors, issuers, civil society, public authorities, scientific committee and other stakeholders) with a call for participation open today. With this transfer of the Observatory’s monitoring and transparency activities, the ambition is also to internationalize the Observatory’s action and monitoring perimeter to better put into perspective the progress made in France, Europe and elsewhere in the world.
Within the foundation, the new platform will work more closely with the academic sphere to develop methodological tools enabling global monitoring of the contribution of finance to the transition towards a low-carbon economy that respects planetary limits. The aim is also to find new international partners to pursue the development of a methodology for monitoring Net-Zero commitments. This initiative will enable French data to be put into perspective with data from other geographical areas. In detail, the new platform, made up of the CTH and the Observatory, will have 4 main areas of work with high added value:
- Publish regulatory data from 29LEC reports in open data, with an analysis layer to enhance readability and comparability;
- Monitor the Net Zero commitments of financial players;
- Continue, at least by 2024, to monitor commitments in line with the principles agreed with the ACPR as part of the European LIFE program;
- Monitor the alignment of the economy as a whole, with a particular focus on the European, and even international, scale, to put the progress of the Paris marketplace into perspective.
A scientific committee will also be set up within the framework of the PARC Foundation, in line with the desire to internationalize the work and recommendations published.
Cécile Goubet, Managing Director of the Institut de la Finance Durable, comments: ‘With this transfer, we are clarifying the scope of the projects and data, while at the same time embarking on a new stage that will enable French players to position themselves in relation to their European and international counterparts. The Institut de la Finance Durable will put all its capacities for coordinating and monitoring players at the service of promoting market data; the Observatoire will be able to rely on an academic structure dedicated entirely to transparency and putting local and international efforts into perspective.
Jean-Michel Beacco, General Delegate of the ILB, adds: ‘The Observatory’s move is part of a desire to adapt its monitoring strategy, at a time when the regulatory framework has changed significantly since its creation in 2019. It is also a way, with the new PARC foundation that we are hosting, to ratify the necessary internationalization of the Observatory’s activities – because the work we carry out here concerns French, European and even global players.
Raphaël Lebel, Director of the Observatoire de la finance durable, concludes: ‘Just as today’s greenhouse gas emissions determine global warming, today’s investments structure tomorrow’s economy. That’s why it’s vital to continue building the Observatoire de la finance durable, and why the new PARC Foundation is ideally suited to accelerate the process, bringing an international dimension, scientific expertise and a public-interest structure to the project.