Published 28.04.2021

Last week was an exciting one for sustainable finance, starting on Wednesday with the adoption of the EU Climate Law by the Council and the European Parliament. This law turns the objectives of the European Green Deal into legal obligations: by 2030, the EU’s net greenhouse gas emissions must be reduced by at least 55% compared to 1990 levels, and by 2050 the EU must reach climate neutrality.

The implementation of the Green Deal is one of President von der Leyen’s priorities. In her speech to the Global Leaders Summit, she stressed that “this decade will be the ‘make or break’ decade for our climate”.

A source of inspiration for other parts of the world?

Immediately after his election, President Biden decided to bring the US back into the Paris Agreement. And last Thursday, before COP 26, Biden invited 40 heads of state and government to a virtual climate summit. He formally committed the US to reducing its emissions by at least half of 2005 levels by 2030. His administration also announced its intention to double the amount of money spent on climate change assistance to developing countries by 2024, compared to what the US was spending annually in the second half of the Obama administration.

China, another high-emitting country, chose the same time to publish an update of its taxonomy, known as the “green projects catalogue”. This brings it closer to the EU’s taxonomy and signals increasing ambitions and closer coordinated action with other regions of the world to combat climate change.

The 21 April package

On 21 April, the European Commission went one step further, adopting the so-called “21 April package“, a set of measures on sustainable EU financing, some of which were long overdue.

The Delegated Act on Taxonomy

After several months of delays and intensive discussions, including pressure from NGOs and Member States, the European Commission adopted the Delegated Act on Taxonomy. This is the first set of technical screening criteria to define activities that substantially contribute to two of the environmental objectives of the Taxonomy Regulation: adaptation to climate change and mitigation of climate change. These criteria are based on scientific advice from the Technical Expert Group (TEG) on Sustainable Finance.

Six Delegated Acts on fiduciary duties

The European Commission has also adopted six Delegated Acts on fiduciary duties for investment and insurance advice, to ensure that advisors, asset managers or insurers integrate sustainability into their procedures and investment advice to clients. These delegated acts will complement the UCITS, MiFID and AIFMD legislative frameworks, among others. These delegated acts need to be approved by the Council and the European Parliament before being published in the Official Journal around summer, and should apply from October 2022.

Proposal for a Directive on Corporate Sustainability Reporting (CSDR)

The European Commission has also adopted a proposal for a Directive on Corporate Sustainability Reporting (CSDR) which is a revision of the Non-Financial Reporting Directive with a broader scope. The aim is to make corporate sustainability reporting more consistent so that financial companies, investors and the general public can use comparable and reliable sustainability information. This proposal will go through the longest legislative procedure, involving discussions and likely amendments in the Council and the European Parliament. We can expect it to be applicable within a few years.

Next steps

The Commission aims to present a renewed strategy on sustainable finance in June, with initiatives and milestones for a sustainable financial system that contributes to the transition to a climate neutral Europe. The Commission will also adopt a standard for EU green bonds in June.

2021 promises to be an intense and busy year for sustainable finance. To this end, the ABBL is actively helping its members to understand how and to what extent industry and regulatory developments in this area would affect the banking sector. The ABBL is organised so that its members can share their views and concerns on sustainability, advocating common positions and identifying and proposing solutions and market practices. On 9 March 2021, the ABBL made available to its members a guide to implementing the Sustainable Finance Disclosure Regulation (“SFDR”).

If you would like to know more about the ABBL’s initiatives in the field of sustainable finance, we invite you to contact Julien Froumouth, Sustainable Finance Advisor, at


By Julien Froumouth and Aurélie Cassou