Switzerland, the EU and Japan will co-lead a new working group on transition finance within the International Platform on Sustainable Finance (IPSF).
Commenced in 2019 by the EU Commission to support and influence the development of a common approach to sustainable finance globally, the IPSF consists of 18 members – representing 55% of greenhouse gas emissions.
Launched last week, the working group will aim to explore how sustainable finance alignment approaches, such as taxonomies, labels and portfolio alignment metrics, as well as corporate strategy and disclosures, may integrate transition considerations.
“The key question in transition finance is whether the economy is on track to achieve the transition to net zero by 2050. This requires transparency based on scientific methodologies that look ahead to the global temperature target and take into account credible corporate transition plans” the Swiss State Secretariat for International Finance (SIF), wrote on LinkedIn.
On deliverables a spokesperson for the SIF – which is the unit that promotes Switzerland’s financial credibility on the global stage and implements national financial policies – told RI: “This year, the working group aims at producing a report to inform the G20 SFWG, that [has] put transition finance high on the list. Timeline depends on G20 SFWG agenda, but it is expected that first products are being developed already by summer.”
They added the working group was not established with an end-date in mind.
In January, the IPSF closed a call for feedback on a report that put forward areas of commonality and differences between the EU and China’s green taxonomies.
Separate to this work, the SIF is also working on whether the Federal Council should update legislation “to prevent so-called greenwashing.”
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