

Michel Sapin, the French Minister of Finance and Public Accounts, has announced that the French government will back a new public SRI quality label for investment funds, with the first kite-marks to be awarded in Q1, 2016.
It is believed to be the first time a government has publicly backed a national SRI standard. The French move could have a significant knock-on effect on global public interest in the sustainability of investment funds. The French government says it aims to establish a European SRI ‘brand’ backed with verification by Cofrac, France’s state-funded, not-for-profit accreditation agency.
The launch of the label follows hard on the heels of new regulations for investors to produce information on how they integrate ESG into their investment processes, report on the GHG emissions of their assets and demonstrate how they are contributing to the financing of a low carbon economy. The relevant article, number 173, from that law – le projet de loi relatif à la transition énergétique pour la croissance verte – has passed in France, but the details are still being finalised.
The new SRI label is being supported by AFG, the French asset management association, which worked with a number of organisations including Paris Europlace, the powerful lobby group for finance in Paris, and the French inter-union body for employee savings (Le Comité Intersyndical de l’Epargne Salariale – CIES) on the specifications for the standards.
Yves Perrier, Chief Executive Officer at Amundi, the French fund manager, and President of the AFG, said the label would bring a “competitive advantage to the Paris financial market”, noting that France already has €230bn in SRI assets.The announcement comes ahead of the COP 21 Summit on Climate Change to be held in Paris in December. Speaking at the inauguration of French SRI week on September 28 (the week runs from October 5-11), Sapin said a committee would start working on the methodology for the label before the year-end, although committee member names have not been announced and it is not yet known how the label will be promoted. Sapin said: “SRI is a young and living entity. The specifications for the label will be improved over time as we develop experience.”
Question marks remain over whether governance of the new label will be held by the AMF French regulator, as has been suggested. The AMF has been working on a set of reporting clarification criteria for responsible investment products. The issue is expected to be clarified later this month. France already has several SRI labels. The best known internationally is run by Novethic, the French responsible finance media and research company. Another is overseen by CIES, which focuses mostly on employee savings plans. A label called “Finansol” is also available for French solidarity savings funds that are invested in social businesses. Some French investment providers have also signed up for AFNOR Certification, which is a quality audit of their SRI approaches. The state label push in France was kicked off in June 2013 by the Brovelli-Drago-Molinié report named after its three authors and commissioned by the Ministry of Economy and Finance, the Ministry of Foreign Commerce, the Ministry of Ecology, Sustainable Development and Energy, and the Ministry of Work, Employment, Professional Training and Social Dialogue, which said France should introduce a government-backed SRI label and consider tax breaks for responsible investments in private equity and the country’s huge life assurance fund market. A CSR platform launched last year by French President, François Hollande, also made SRI and responsible finance one of its three main working groups.
Additional reporting by Hugh Wheelan