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Sustainable Finance Regulation

Time to act for on the regulatory landscape

Sustainable Finance is now in the focus of public and political attention. This is because the global financial system has an important role to play in the implementation of the United Nations 2030 Agenda (Sustainable Development Goals) and the Paris Climate Agreement. By directing financial flows into sustainable activities and integrating environmental, social and governance (ESG) criteria into business and investment decisions, the financial sector has great potential to change markets and to shape sustainable economic systems.

In March 2018, the European Commission’s Action Plan on Sustainable Finance provided decisive impetus to the topic of sustainable finance. The Action Plan sets out a comprehensive strategy to connect sustainability and finance, by amending financial regulations and policies and explicitly introducing sustainability aspects.

The European Commission’s Action Plan on Sustainable Finance

According to the plan, sustainability standards will be incorporated to a varying extent into the following major regulatory frameworks:
  • Benchmark Regulation
  • Markets in Financial Instruments Directive II (MiFID II)
  • Alternative Investment Fund Managers Directive (AIFMD)
  • Directive on Undertakings for Collective Investment in Transferable Securities (UCITS)
  • Directive on the Activities and Supervision of Institutions for Occupational Retirement Provision (IORP II)
  • Directive on the Taking-up and Pursuit of the Business of Insurance and Reinsurance (Solvency II)
  • Insurance Distribution Directive (IDD)
  • Capital Requirements Regulation / Capital Requirements Directives (CRR/CRD)
  • Credit Rating Agencies Regulation (CRA Regulation)
In addition, the Action Plan envisions new legislative initiatives such as:
  • Regulation on Disclosures relating to Sustainable Investments and Sustainability Risks
  • EU Taxonomy Regulation for Sustainable Activities

The creation of various standards and labels for green financial products, such as an EU Ecolabel for Financial Products and EU Green Bond Standard, is also on the regulatory agenda. In addition, the Commission is looking into providing guidance on the disclosure of climate-related information considering standards such as those by the Task Force on Climate-related Financial Disclosure (TCFD).

Given the large number of regulations concerned and the pace by which sustainability is entering the mainstream of financial markets regulation, all banks and financial institutions that are active in the EU markets need to keep up with new legal requirements, and there is an inherent risk of taking required actions too late.  

At the same time, financial market participants are confronted with increasing expectations of different stakeholders, which expect transparency and disclosure of the company's services in terms of sustainability.

The Action Plan timeline

The EUAP timeline The EUAP timeline

Our services

Legal is a market and thought leader in the field of Sustainable Finance and we can make the most of extensive know-how from various successful projects with financial institutions. We help you meet the regulatory requirements while harnessing the business potential of sustainable finance.

We have specialist teams to help you address your environmental, social and governance (ESG) challenges as well as subject matter knowledge, combined with an in-depth understanding of the local regulatory landscape.

  • Strategic impact assessment of the EU Action Plan and definition of sustainability TOM
  • Regulatory impact assessment
  • Amendment of risk management methodology
  •  Integration of taxonomy criteria into investment decisions
  • Implementation of TCFD / PRI and PRB standards
  • Definition of top-down sustainability strategy
  • Bottom-up portfolio quantification on asset level
  • Product governance and target market definition
  • Labelling (setup and registration process)
  • Analysis of investment strategy of funds
  • Structuring impact & ESG investing funds

Contact us

Dr. Günther Dobrauz

Dr. Günther Dobrauz

Partner and Leader Legal, PwC Switzerland

Tel: +41 58 792 14 97

Dr. Antonios  Koumbarakis

Dr. Antonios Koumbarakis

Head Sustainability & Strategic Regulatory, PwC Switzerland

Tel: +41 58 792 45 23

Sofia Jaccard

Sofia Jaccard

Manager, Sustainability & Strategic Regulatory, PwC Switzerland

Tel: +41 58 792 26 87

Moritz  Obst

Moritz Obst

Strategic Regulatory & Sustainability Services, Legal, PwC Switzerland

Tel: +41 58 792 47 19

Dr. Astrid Offenhammer

Dr. Astrid Offenhammer

Senior Manager, Sustainability & Strategic Regulatory, PwC Switzerland

Tel: +41 78 696 32 11

Elena Prässler

Elena Prässler

Strategic Regulatory and Sustainability Services, Legal, PwC Switzerland

Tel: +41 58 792 28 24

Martje Timmermann

Martje Timmermann

Strategic Regulatory & Sustainability Services, Legal, PwC Switzerland

Tel: +41 58 792 11 19

Marc Lehmann

Marc Lehmann

Director, Operational Excellence & ESG Transformation Leader, PwC Switzerland

Tel: +41 58 792 26 50

Juliane Welz

Juliane Welz

Senior Manager, Insurance Transformation, PwC Switzerland

Tel: +41 79 179 47 04