A credible sustainable financial centre without greenwashing

  • 16 dicembre 2022
    A credible sustainable financial centre without greenwashing

    Today, the Federal Council published its Sustainable Finance Strategy for the Swiss financial center up to the year 2025 and defined fields of action for measures to be developed. The Asset Management Association Switzerland (AMAS) welcomes this strategy update and, together with the other Swiss financial associations, supports the common goal of establishing a leading sustainable financial center.

    Switzerland needs a holistic climate strategy
    However, AMAS is convinced that this goal, and in particular the net zero goal, can only be achieved in line with a holistic Swiss climate strategy that includes all parts of the Swiss economy. AMAS therefore considers a revised Swiss CO2 law to be an elementary step towards strengthening the international competitiveness of the financial center within the framework of an overall strategy and to manifest its high credibility in sustainability.
    The Federal Council has also defined the further course of action to avoid greenwashing in the financial market. Like the Federal Council, AMAS takes the view that there is a need for a clear and general understanding of when a financial product or service can be offered as sustainable. AMAS will take part in the working group that is set up implement greenwashing prevention.

    Financial products must show sustainability impact
    AMAS welcomes the fact that the Federal Council advocates differentiated communication to investors on the sustainability impact of investment products. Products that only include sustainability indicators or exclude certain companies lack a direct link to sustainability goals.
    In its self-regulation on transparency and disclosure for collective assets with sustainability reference published last September, AMAS no longer classified such products as "sustainable". The binding requirements contained in the self-regulation serve the goal of establishing high quality standards for sustainability-related financial investments in the Swiss asset management industry.
    Self-regulation continues to pursue the goal of preventing and combating greenwashing at the organizational and product levels mentioned by the Swiss Financial Market Supervisory Authority (FINMA). AMAS remains convinced of the subsidiary role of the state. The implementation of self-regulation and the development of its effect remain to be seen.

    New product category for impact investments
    Among the further measures for a leading sustainable financial center, the Federal Council has identified the mainstreaming of impact investments. A working group with industry representatives is to examine the introduction of a new product category oriented towards the characteristics of a Long-Term Investment Fund (LTIF). Another working group is also to develop measures to ensure that financial institutions active in the private client and retail segment can meet the high requirements for the quality of advice to distribute impact investments in the form of an LTIF. AMAS considers this necessary, as such products have a higher degree of complexity and are associated with risks.
    In principle, an LTIF in the impact sector could achieve the goal of increasing the volume of project financing by opening a new asset class to private investors. Previous experience with the European Long-Term Investment Fund (ELTIF) has shown that this would only be effective if the minimum investment threshold were set at a correspondingly low level (e.g. CHF 10,000).

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    Bundesrat will Greenwashing im Finanzmarkt vorbeugen