The Australian Sustainable Finance Initiative (ASFI), the financial sector-led sustainability body, has kick-started its ‘green’ taxonomy efforts with a call, yesterday, for members to form a new technical advisory group.
Its call for expressions of interest came hot on the heels of the publication of the body’s 2022 priorities last week, which included the development of an “industry-led” Australian Sustainable Finance Taxonomy among them, along with a focus on biodiversity.
ASFI, which was set up in 2019 by the Australian financial sector, said its planned taxonomy will draw on existing international efforts, including the EU’s and the International Platform on Sustainable Finance’s Common Ground Taxonomy. But added that it will work with the Australian financial system “to determine what a sustainable finance taxonomy should look like in Australia”.
“Key to the success of the project will be to ensure international credibility and inter-operability, while reflecting the Australian economy and context,” the body wrote.
The ASFI board includes representatives from a range of Australian financial players, including two of the country’s biggest banks ANZ and NAB, as well as representatives of super funds HESTA and Cbus.
Several other resource intensive economies are also moving towards establishing their own taxonomies, including Canada, which was meant to release its “transition taxonomy” before the end of last year, but the framework has not yet appeared.
Speaking on a panel on the topic at RI Canada last September, Peter Johnson, director of sustainable finance at Scotiabank, told delegates that, “[w]e have a very different definition of transition in Canada than perhaps the Europeans or other groups.” “Our definition of transition that we’re working from is the reduction of greenhouse gas emissions,” he added.
Unlike most national sustainable finance bodies, ASFI and its 2020 roadmap were established without input from the Australian Government. In the update last week, however, ASFI stated that the government is showing more interest in its work and revealed that its new Advisory Committee would include representatives from the Australian Prudential Regulation Authority (APRA), Australian Securities and Investments Commission (ASIC) and the Reserve Bank of Australia (RBA), as well as the Government of New South Wales.
ASFI also revealed in yesterday’s call for applications that the taxonomy work also has “strong support” from the Council of Financial Regulators, the coordinating body for Australia’s main financial regulatory agencies, which will “remain actively engaged in the ASFI taxonomy project as it progresses”.
Members of the taxonomy technical working group will be selected based on their expertise around the “development or application of sustainable finance taxonomies or other sustainable finance policy, regulation and tools,” the body said.
Applications are open until 12 April.