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Archive » December 2021 » European Banks Lead on Financing Sustainability

European Banks Lead on Financing Sustainability

Wim Mijs
December 2021 - n. 12
Keywords: European Banking sector, financing sustainability, climate change
Jel codes: G21, G28, Q54

To avoid the most dangerous consequences of climate change, global greenhouse gas emissions must drop by 50% over the next decade. The European banking sector is in a unique position as it is not only directly impacted by risks linked to climate change, but also plays a crucial role in financing the transition towards a low-carbon economy through its allocation of resources, including corporate and retail lending, financial markets intermediation, and asset management. Climate change is at the top of banks' sustainability concerns and banks across the Eu are committing to sustainable banking. However, moving forward, governments will need to deliver on their policy objectives and the solution will have to be global if we want to accelerate the transition and ensure a safe environment for future generations.

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