‘CONSISTENCY, COLLABORATION AND COHERENCE’ VITAL TO EMBEDDING SUSTAINABILITY IN GLOBAL FINANCE SECTOR
February 28, 2023
London, UK – Experts in green finance have highlighted the importance of global consistency and collaboration to drive change across all aspects of the ESG agenda, as BSI, the business improvement and standards company, hosted an event today in London to highlight recent guidance designed to ‘demystify’ sustainability principles for financial sector organizations.
Speaking ahead of the event at Bloomberg in London, Nigel Topping, the former UN High-Level Climate Action Champion, said: ‘The new narrative of change has to be collaboration and not competition. Ensuring all in the financial sector are talking the same language and tackling the heart of the issue is essential.’
Topping will be one of several finance experts, including Christ Faint, Head Of the Climate Hub Division at the Bank of England and Cathrine Armour, Chief Reporting Officer for the UN Principles for Responsible Investment, highlighting the recent launch of a Sustainable Finance Standard (ISO 32210:2022). The standard offers guidance for finance organizations, including direct lenders and investors, asset managers and service providers, to drive sustainable outcomes and integrate key principles of sustainability into their operations, activities, products and services.
The support of the financial sector is vital in addressing global environmental and social challenges, and supporting sustainability, including tackling climate change. In understanding and developing an alignment of interest in tackling these challenges, global organizations can contribute toward positive environmental and social outcomes and drive progress towards a sustainable world.
The globally applicable standard has been developed to address the lack of clarity surrounding the global sustainable finance sector. With numerous frameworks and regulations in different jurisdictions, these principles are designed to address this fragmentation and facilitate greater collaboration in the sector by offering a path through the confusion for financial organizations.
The standard aims to help financial organizations avoid greenwashing by setting a credible, coherent path to becoming more sustainable. It provides a framework for organizations that wish to be sustainable and better aligned with global initiatives like the United Nation’s Sustainable Development Goals (UN SDGs) and the Paris Agreement.
The standard aims to facilitate shared understanding and collaboration in the global finance sector around sustainability. The framework recognizes that transformation is needed to equip the industry to address issues across all elements of ESG including inequality, climate change, environmental degradation, poverty, prosperity, peace, and justice.
Scott Steedman, Director General, Standards, BSI said: “Strengthening understanding of what sustainable finance is, by enhancing global consistency and offering more certainty, has the potential to offer a huge benefit to society. Harmonizing, aligning and demystifying the complex international system of regulation, frameworks and standards can help financial sector organizations accelerate change and support the realization of sustainability ambitions.
“BSI is committed to supporting financial organizations on their journeys to becoming more sustainable, by clarifying what is expected of them and how to align their strategy and operations with different regulatory requirements and stakeholder and market expectations. This standard on sustainable finance can build confidence in the financial sector and offer long-term benefit for everyone.”
Nigel Topping, the former UN High-Level Climate Action Champion, said: ‘The global challenges we face mean it is vital for financial organizations to play their part in building a more sustainable economy and society. The new narrative of change has to be collaboration and not competition. Ensuring all in the financial sector are talking the same language and tackling the heart of the issue is essential.
‘Standards play an ever-increasing role in issues with a global impact and relevance; I saw first-hand at COP27 with the work that BSI has done around the Net Zero Guidelines, which were a significant step forward. This ISO standard will drive change and help embed sustainability in the global financial sector.’
BS ISO 32210 contains advice on several key areas, including:
- Governance and culture, including that responsibility for sustainability matters should be integrated throughout corporate culture.
- Strategy alignment and objectives – including the adoption of a governing-body-approved sustainability policy or similar statement.
- Risk and opportunity management and impact assessment
- Stakeholder engagement
- Monitoring, measuring and metrics
- Reporting, transparency and assurance
- Continual improvement and enhancing ambition
Beyond financial institutions and intermediaries, this document can be used by other parties such as providers or recipients of sustainable finance, governmental organizations, public and private sector, business entities, industry associations, financial market regulators, and supervisory and control bodies.
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