The EU agrees on new rules on sustainable investments

Two new benchmarks are to boost sustainable investments.

Valdis Dombrovskis, Vice-President in the European Commission also in charge of Financial Stability, Financial Services and Capital Markets Union | Photo: /ritzau/AP Photo/Virginia Mayo

A new agreement which is to nudge European financial institutions to making the world more sustainable is around the corner.

This week, the European Parliament and the member states agreed on a new generation of low-carbon benchmarks. The European Parliament and the Council have yet to formally adopt the rules that were proposed by the European Commission in May 2018, the European Commission writes in a press release.

This agreement creates two new categories of low-carbon benchmarks: a climate-transition benchmark and a specialized benchmark which brings investment portfolios in line with the Paris Agreement goal to limit the global temperature increase to 1.5˚above pre-industrial levels.

"With this agreement, investors will benefit from two reliable benchmarks to pursue their ambitious climate strategies. This is a milestone of the Commission action plan on financing sustainable growth, participating in reorienting capital flows towards sustainable investment", says Valdis Dombrovskis, Vice-President of the Commission in the press release.

The two new categories are voluntary for investors to use.

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