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Archive » September 2024 » Biodiversity loss, financial system, and banking: regulation and expected impacts

Biodiversity loss, financial system, and banking: regulation and expected impacts

Giuseppe Rimo, Stefano Cenni, Simona Cosma
September 2024 - n. 9
Keywords: Biodiversità, banche, finanza sostenibile, Esg
Jel codes: G21, G28, Q57

Biodiversity loss is the new big problem to be overseen. The strong link between the economy and biodiversity highlights the systemic scope of this phenomenon, whose repercussions on the financial system are beginning to come under the spotlight of academics, regulators and government agencies. The European Union, with its Biodiversity Strategy and a series of regulations and directives aimed at channeling funding toward green activities, stimulating sustainability reporting with special standards dedicated to biodiversity, and punishing environmental crimes, seems to have embarked on a virtuous path, which, however, will entail direct and indirect costs for businesses and especially for banks: these will have to transpose, in addition to general regulations, the guidelines of the Supervisory Authorities that call for an increasingly Esg-oriented management of banking business and traditional risks.

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