Sustainability, green reporting, zero emission standards. Terms that have now entered common parlance but whose meaning is often still obscure. Fashion or mission?
Many are wondering as well as wondering whether the trend imposed by the authorities and ridden by European and global companies and financial institutions will continue apace and with what foundation. A question that becomes more insistent as new deadlines approach. One example?
According to the EU Commission's European directive, starting in 2024, all large companies and listed SMEs will have to report sustainability information according to new criteria and content. While financial institutions are progressively called upon to be more transparent in terms of investments and beyond.
What is sustainable investment and how is the European financial industry moving forward?
"A sustainable investment is the use of a sum of money for the purpose of making a profit for oneself without harming others or the environment, but on the contrary producing added value for society and the economy as well," illustrates Elena Leonardi, Head of Banking Group Sustainability Service at Banca Generali. "In concrete terms, since financial investment is usually allocated to the purchase of equity or debt stakes of an issuing company, it is necessary for it to adopt policies and rules aimed at respecting the environment, the community and sound corporate governance, i.e., carefully considering the so-called E (Environment), S (Social) and G (Governance) factors. This seemingly simple paradigm has actually activated major international institutions in recent years."
At the European level, the path toward sustainable finance began as early as 2018 with the publication of the European Commission's Action Plan and has continued in subsequent years through the Green Deal and the enactment of regulations aimed at directing financial investments toward a more sustainable economy, introducing sustainability into risk management procedures, and strengthening transparency in investments. Reference is particularly to two important European regulations such as Disclosure Regulation No. 2088 of 2019 and Taxonomy Regulation No. 852 of 2020.
"To complete the picture, the entry into force last year of MIFID-ESG, which assesses the consistency of the products in which clients invest also with respect to sustainability preferences, has represented for the entire finance industry and also for Banca Generali an opportunity to strengthen the relationship with its clients. Building effective and simple communication is the key to raising awareness and making people appreciate the uniqueness of Advice, adding a new dimension of value to investment," Leonardi continues.
The manager then reminds us that the sustainable finance agenda continues to be a top priority, and this can be seen by looking at the various initiatives that regulators are pursuing around the world. The issues at the center of regulatory institutions' debates in the latest period include greenwashing and the carbon market, among others.
Sustainability for Banca Generali
In response to all this, an increasing number of large market-leading institutions are moving not only to align practices with an evolving world but also to raise as many people's awareness of an issue that is factually emerging with great urgency. Banca Generali stands out among them: both in terms of business choices (suffice it to say that ESG assets under management as of June 30 reached 14.1 billion) and in terms of awareness-raising campaigns, first and foremost BG4SDG's - Time To Change, carried out in tandem with internationally renowned photographer Stefano Guindani.
In short, for the bank led by CEO Gian Maria Mossa, the creation of shared value ranges from the pre-positioning of offerings to governance, passing through the redefinition now as far back as 2017 of its business model built around a vision no longer only of quality and innovation, but also and above all of sustainable development. Prominent in this mission is the role alongside families in the "protection" of their assets and life projects. Wanting to get even more concrete in addition to the increase in Esg assets (grown 14-fold since 2019 to date) and funds created with this vocation - such as the Lux Im Esg Flexible Global Equity - by 2025 the bank aims to reduce its carbon footprint by 25 percent compared to 2019 in relation to direct investments managed by BG. By 2030, the goal is a phase-out of all investments in fossil fuel-related companies, while 2040 is set as the goal of net zero emissions.
Elena Leonardi, Head of Sustainability at Banca Generali
Sustainable investment is the use of a sum of money for the purpose of making a profit for oneself without harming others or the environment, but on the contrary producing added value for society and the economy as well.
