The Minister for the Ecological Transition acting, Teresa Ribera, stressed that the transition to a sustainable future, consistent with zero net emissions, offers an opportunity for the financial sector to reconnect its activity with the needs of the real economy, while ensuring its viability in the medium and long term.
In his speech during the opening Biscay ESG Global Summit on responsible investment, held in Bilbao, Ribera also pointed out that this process requires political momentum and that this must come hand in hand with an increase in scale in sustainable financing.
The holder of Ecological Transition has defended the work of the Government of Spain for aligning Spanish legislation for the promotion of sustainable finance with that of other pioneering countries in this process and has opted for the development of a Strategic Agenda for Sustainable Finance. Similarly, it considers it necessary to move forward in the Sustainable Finance Action Plan of the European Union (EU). In this sense, Ribera recalled that the report of the European working group that has developed the principles of a taxonomy "that allows us to know what we are talking about when referring to sustainable finance" has been released.
In his opinion, in a context where it is still far from meeting the objectives of the Paris Agreement, the European Union can play a key role: "This year is the year of raising climatic ambition, in the coming days we will debate why Europe should aspire to climate neutrality in 2050 and how to be ultimately more ambitious in the medium and long term. term. targets to 2030 they have become outdated, "he said.
The acting minister stressed that the next fifteen years will be "a key moment" in economic history. Investments of some 90 trillion US dollars are expected between now and 2030 in infrastructure worldwide. In Spain, as he explained, the Strategic Framework of Energy and Climate -a set of measures that has made the ecological transition a "State policy" – will mobilize 236,000 million public investment and under public-private collaboration models. This boost to the decarbonisation of the economy will increase between 19,300 and 25,100 million between 2021 and 2030 the Gross Domestic Product, 1.8% in 2030 in relation to a scenario without the measures of the Framework; and will generate between 250.00 and 364.000 new quality jobs between 2021 and 2030.
"One of the measures that the Government contemplates to finance part of the public investment is the issuance by the Treasury of green bonds, which will provide an impetus for the private sector to invest in this instrument, which is fundamental for financing the green transition", he indicated. .
Integrate environmental, social and good governance criteria
Ribera pointed out that the studies show how companies that incorporate environmental, social and good governance criteria in their organization (ASG, in its English acronym) tend to better manage their risks and record higher profits than their competitors, with favorable effects. about the price of the action. Therefore, it considers it necessary to establish "minimum criteria on the integration of ESG factors". "The steps we take now will be decisive to anchor this process of change in an orderly manner and ensure that in the future no steps are taken back," he added.
For the acting minister for the Ecological Transition, "the financial sector has understood the challenge posed by climate change," which puts at risk "the stability of the global economy." Therefore, "we must activate the market and discourage carbon-intensive assets." "It is necessary to move towards a climate-neutral development model that is also socially beneficial and inclusive if we want this process of change to flourish, which is why it must be designed in such a way as to maximize opportunities for all, without leaving anyone behind", he pointed out. .
In this regard, Ribera has underlined the "clear will on the part of large investors and large funds, in the medium and long term, to change and integrate climate risk in their decisions". He has cited examples such as the position expressed, yesterday, by the Bank of England, which announced the incorporation of climate risk in the stress tests of the insurance sector; or the recent decision of the Norwegian Sovereign Fund, which involves a significant disinvestment in fossil fuels and the largest investment in renewable energy made to date.
"We hope that our country has the capacity to be attractive and give enough confidence to part of that reinvestment come to our territory," he said.
Situation in Spain
The acting minister has confirmed the "growing interest in sustainable finance" in our country. Only 17% of the entities do not have any sustainable investment in their portfolios, and 54% dedicate between 1% and 20% to this type of operations. In 25% of institutional investors, the presence of sustainable investments is the majority.
"It is increasingly accepted that the profitability of sustainable products is similar to that of other investments, or even higher," said Ribera, who hopes that the Spanish financial sector integrates the management of climate risks as a financial risk. more in your business strategies. In fact, he recalled, some levers are already being activated as the first emission of green bonds by the Official Credit Institute amounting to 500 million euros, which occurred last April. The demand exceeded 3,400 million euros, six times the amount of the issue, which highlights the interest of investors.
"The sustainability agenda is not an aesthetic issue but must be structurally integrated into the policies, if you want to maximize your benefits in the medium and long term Stable and ambitious policies must accompany and guide investments to order the transition ecological and give confidence to, thus, provide solvency to meet the objective of maintaining global warming in the limit of safety of 1.5 º C. Spain, as is already demonstrating, is willing to give the battle of the hand of the financial sector ", it is finished.