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Archive » April 2023 » European banks and Esg: the opportunities of sustainable transition

European banks and Esg: the opportunities of sustainable transition

Cristiano Zazzara, Clara Cibrario Assereto
April 2023 - n. 4
Keywords: Esg, finanza sostenibile, tassonomia Ue, stress test sul rischio climatico, requisiti patrimoniali
Jel codes: G21, M14, O44, Q54

European banks have been increasingly focusing on Environmental, Social, and Governance (Esg) issues as a key component of their business strategy. The Covid-19 pandemic has demonstrated the importance of banks in supporting the economy and stakeholders, and they have emerged as key players in the sustainable transition. The European Green Deal, which aims to reduce greenhouse gas emissions by at least 55% by 2030, indeed represents a significant opportunity. Large investments are required to decarbonize various sectors, such as energy production, heavy industries, transport, and to improve the energy efficiency of buildings. European banks have a crucial role to play in this transition by assisting companies in adopting more sustainable business models, with the ultimate goal of achieving net-zero greenhouse gas emissions by 2050. Moreover, Eu rules on transparency of Esg information and stress tests require banks to consider Esg issues in their capital requirements. This further emphasizes the importance of integrating Esg factors into the business strategies of European banks.

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