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Green Financial Products in the EU — A Critical Review of the Status Quo

Author

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  • Volker Brühl

    (Goethe-Universität Frankfurt)

Abstract

The financial sector plays an important role in supporting the green transformation of the European economy. A critical assessment of the current regulatory framework for sustainable finance in Europe leads to ambiguous results. Although the level of transparency on environmental, social and governance aspects of financial products has improved significantly, it is questionable whether the complex, mainly disclosure-oriented architecture is sufficient to mobilise more private capital into sustainable investments. It should be discussed whether a minimum taxonomy ratio or Green Asset Ratio has to be fulfilled to market a financial product as “green”. Furthermore, because of the high complexity of the regulation, it could be helpful for private investors to establish a simplified green rating, based on the taxonomy ratio, to facilitate the selection of green financial products.

Suggested Citation

  • Volker Brühl, 2022. "Green Financial Products in the EU — A Critical Review of the Status Quo," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 57(4), pages 252-259, July.
    • Handle: RePEc:spr:intere:v:57:y:2022:i:4:d:10.1007_s10272-022-1057-2
    DOI: 10.1007/s10272-022-1057-2
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    References listed on IDEAS

    as
    1. Romain Berrou & Philippe Dessertine & Marco Migliorelli, 2019. "An Overview of Green Finance," Palgrave Studies in Impact Finance, in: Marco Migliorelli & Philippe Dessertine (ed.), The Rise of Green Finance in Europe, chapter 0, pages 3-29, Palgrave Macmillan.
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    More about this item

    Keywords

    G10; G20;

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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