The German government aims to make Germany a world-leading centre for sustainable finance. A stable and resilient financial system that can be relied upon to be ready for sustainable investments and business models is a key competitive advantage. We therefore see it as crucial that sustainable finance (SF) leads to an increase in the financial industry’s awareness of the risks and opportunities relating to sustainability issues and a change in capital flows such that the 17 Global Goals of the UN’s 2030 Agenda for Sustainable Development are achieved and the Paris Climate Agreement can be implemented (“shifting the trillions”). BaFin is making a very important contribution to these goals through its commitment to the objective of tackling greenwashing.

Continuing to implement the German Sustainable Finance Strategy, which was published in May 2021 and comprises 26 specific measures, is very important to the new government. Here are some of the successes that have already been achieved:

The Sustainable Finance Advisory Committee was formed again for the 20th legislative period. The inaugural meeting was held on 10 June 2022 at the Federal Ministry of Finance (Bundesministerium der Finanzen – BMF). With the goal of more transparent, more consistent guidance on ESG, the BMF and the Sustainable Finance Advisory Committee are working to improve investors’ access to information about the ESG content of their investment products. The government’s success with Green German Federal Securities has also continued: the issue volume of Green German Federal Securities is to be further expanded in 2022 (from EUR 12.5 billion in 2021 and EUR 11.5 billion in 2020).

We are also committed to practice-oriented, ambitious sustainable finance regulation at EU level, e.g. in the expansion of the EU taxonomy to include technical screening criteria for environmental objectives 3-6, but also in companies’ sustainability reporting: during the trilogue on the Corporate Sustainability Reporting Directive (CSRD), we worked hard to ensure that the work of global standard-setters is adequately taken into account in Level 2 legislative acts in order to make proportional, harmonised reporting standards possible. Frankfurt won the bid to host the headquarters of the International Sustainability Standards Board (ISSB), established in November 2021, and the office of its chair. This makes Germany the European hub for establishing a “global baseline” and developing sustainable financial expertise. The G7 expressly welcomed the creation of the ISSB in their May 2022 communiqué, emphasising the importance of ensuring the compatibility of ISSB, national and regional standards.

This highlights two other factors that are critical for sustainable finance to be successful: a constructive debate between politicians, supervisors, financial market participants, consumers, participants in the real economy and academic experts, and consistent, close international cooperation.