France seeks to drive Article 173 ESG reporting across Europe and push development banks on green finance

The French government is seeking to maintain and broaden the momentum on sustainable finance by pushing for its Article 173 ESG reporting requirement for investors to be adopted and promoted across Europe. It will also seek to push the large, global multilateral development banks (MDBs) to focus more on green finance and attracting private capital to partner with them on these investments as part of its Presidency of the G7 group of nations in 2019.
Brune Poirson, French Secretary of State to the Minister for the Ecological and Inclusive Transition, told the UNEPFI Global Round Table in Paris this week that sustainable finance was “not a marketing issue” in France. She said: “President Macron is deeply concerned about it. The question we are asking is how we do it, not whether we should do it.”
She laid out three priorities for current French government action. The first, she said, was to ensure that green products are universalised and accompanied by broad commitments for companies and investors to take into account ESG in their activities.
The second was the promotion of Article 173: “We want to take it to the European level and for it to be industrialised across European financial centres.” Article 173 is a comply-or-explain rule that requires investors to report on how they integrate ESG into their investment processes, outline the greenhouse gas (GHG) emissions of their investments and contribute to the financing of a low carbon economy.The third strand of action, she said, was to accelerate green finance via the One Planet Summit, which it hosts annually, which she said was also developing a large scale platform to test new sustainable finance institutions and solutions. An area of particular focus, she said, was biodiversity: “The One Planet Summit lab is where we want to provide recommendations and actions, as well as create coalitions on biodiversity, clean energy and oceans that can fund these projects. We want to push this agenda at a European level and include China and India. It’s a major priority.”
In this vein, Philippe Zaouati, Chairman at Finance for Tomorrow, France’s sustainable finance lobby group, and CEO of Mirova, the Paris-based sustainable fund manager, said Finance for Tomorrow and the United Nations Environment Programme (UNEP) had co-ordinated the first meeting of 20 national green finance initiatives in Shanghai two weeks ago, and said France and China were looking to lead work here.
France will host the G7 in 2019 and Secretary of State Poirson said that in advance of G7 meetings, France will work on an agenda with its partner finance and environment ministries to look specifically at the mandates of MDBs like the World Bank: “They have to focus more of their money on green finance and attract more private capital. We want to see something concrete here.”