In January 2018, The High-Level Expert Group (HLEG) on Sustainable Finance, established by the European Commission, has published its final report which shall incite reforms along the entire investment chain, on which to build a sustainable finance strategy for the EU. Following the Paris Climate Agreement, the process will deal with greenhouse gas emissions mitigation, adaptation and finance. The final report highlights the responsibility towards future generations and offers recommendations to make finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development in a comprehensive way. In March 2018, the Commission shall bring forward a broad Action Plan on sustainable finance, building on the recommendations in this report.
Sustainable Finances refer to any form of financial service integrating environmental, social and governance (ESG) criteria into the business or investment decisions for the lasting benefit of both clients and society at large. But it does not rest only upon formal frames, provisions and measures on an international level, but also requires a broad expert discussion within the states, including private enterprises and the civil society. An open process of dialogue and analysis can generate the real change. As the final report underpins, the sustainable finance should become a permanent feature of European markets and policy-making.
The term Sustainable Public Finance, or Fiscal Stability, refers to the quality of the national budgetary framework, as that plays a crucial role in supporting fiscal consolidation and sustainable public finance. It represents the ability of a government to sustain its current spending, tax and other policies in the long run without threatening the government’s solvency or without defaulting on some of the government’s liabilities or promised expenditures.
You can check out our entry for Sustainable Public Finance in IATE down below:
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Our previous IATE Terms of the Week can be searched through here.
- EU-High Level Expert Group on Sustainable Finance. 2018. Final Report. Accessible here. [Accessed on 26/02/2018]
- Swiss Sustainable Finance > resources > What is sustainable finance. Accessible here. [Accessed on 26/02/2018]
- European Commission. European Semester Thematic Factsheet. Accessible here. [Accessed on 26/02/2018]
Written by Veronika Lovritš – Communication Study Visitor at the Terminology Coordination Unit of the European Parliament (Luxembourg) and a student of the Master Program in Learning and Communication in Multilingual and Multicultural Contexts at the University of Luxembourg. She holds an MA in Law and Legal Science and a BA in Sociology from the Masaryk University in Brno, Czech Republic. She speaks Czech, English, German, French and Luxembourgish.