Redirecting financial flows

The majority of news and activities in this newsletter revolves around climate change – no surprise as the international community is currently debating ways and mechanisms to achieve the nationally defined contributions to climate change mitigation at COP24 in Katowice. At the same time, calls to the financial industry to act on climate change risks are becoming louder. The biggest task is not just reducing risks in liquid portfolios, but also - and maybe more importantly, redirecting financial flows into solutions for a carbon-efficient economy. It is one of SSF’s objectives for 2019 to provide insights into tools and procedures for financing innovative products and companies.

2018 has been a turnaround year for sustainable finance, with the EU action plan putting the topic on top of the agenda of financial actors. The increasing mainstreaming of ESG integration, the growing momentum of "Financial Centres for Sustainability" and the bridges being built between development banks and the private sector are just some examples of the positive dynamics. Still, much needs to be done to unleash the full potential of sustainable financial services. We look forward to further working with you on practical solutions.

We wish you a nice festive season and send our best wishes for a sustainable 2019.

Kind regards,

Sabine Döbeli

CEO Swiss Sustainable Finance

SSF activities

Regulatory and market news

SSF and sustainable finance in the media

New members joining SSF

Join these events

New reports & studies

Open Letter to Index Providers – call open until 21 December

SSF is coordinating an investor initiative for an "Open letter to global index providers" to exclude controversial weapons from mainstream indices. Launched in August, the initiative has received support from a core group of more than 60 Swiss investors. After its posting on the PRI collaborative platform, considerable support from large international asset owners and managers could be gained, bringing the current number of signatories up to 89, managing around USD 4.6 trillion. The letter is still open to other co-signatories until 21 December. More information can be found on the SSF website.

SSF workshops on "Measuring the impact of investment portfolios"

Workshop on metrics for a sustainable capital shift

Event in Geneva - Private Wealth Management et Durabilité. Nouvelles directives MIFID: Quelles opportunitiés pour la Suisse?

SSF brings Swiss perspective into the FC4S Network

In early November, during the Climate Innovation Summit in Dublin, SSF was present for the launch of the FC4S European Hub.

SSF promotes Swiss sustainable finance capacities during Paris Climate Finance Week

At the conference "La Finance Durable: Rouage-clé de l’Accord de Paris sur le Climat", organised by the Swiss Embassy in Paris and held during the Climate Finance Week, Sabine Döbeli, SSF CEO, presented Swiss initiatives and developments in the field of sustainable finance.

Workshops for pension funds in Lausanne and Lugano

In November SSF organised two workshops in Lausanne and Lugano, discussing sustainability in portfolios and the impact of voluntary initiatives with over 20 representatives of institutional investors.

SSF interviewed for new CAS in Sustainable Finance

Sabine Döbeli, SSF CEO, contributed to a video on the responsible investment market for the new online Certificate of Advanced Studies in Sustainable Finance, offered by the Haute école de gestion in Geneva.

Read more about these and other SSF activities

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Swiss news

• The Swiss National Council rejected the cornerstone of Swiss climate policy, the revision of the CO2 law, after substantial elements had been removed. The revision is now on the agenda of the Council of States and will be re-debated in the Swiss National Council at the end of 2019. The Swiss economy thus has to wait further for a clear framework on efficient climate mitigation solutions.
• 12 Swiss professors made a public statement (in German) on the integration of climate risk into the risk management of the Swiss National Bank (consult French version here).
• The Swiss government is set to repeat a survey of asset owners’ alignment to a 2°C path in 2020, according to the State Secretariat for International Finance (SIF). The first survey was carried out in 2017. While it revealed that Swiss pension funds and insurers were more on a 4- 6° path, recent feedback has shown that over 30 of them are introducing new climate strategies.
• According to a legal opinion by the law firm Niederer Kraft Frey, commissioned by the Climate Alliance, fiduciary duty under current Swiss law is also applicable to climate risks (if financially material). A further legal opinion, commissioned by WWF, examined the four pillars of the EU Sustainable Finance Action Plan. 

International initiatives

• At the UN Climate Conference (COP24) currently being held in Katowice, Poland, an alliance of global investors called upon governments to step up action to address climate change.
• UN Environment Finance Initiative (UNEP FI) announced that it will develop a new generation of risk assessment tools in partnership with 16 insures including AXA, Munich Re and Swiss Re. The group of insurers together represent around 10% of world premia and USD 5 trillion in assets under management.
• UNEP FI also launched, in cooperation with 28 banks, a global public consultation on new principles for sustainable banking, which would drive the industry’s alignment with the Paris Agreement and the SDGs.
  
• The Financial Centres for Sustainability (FC4S) network welcomed the U.S. Alliance for Sustainable Finance, which was founded in early December by 15 companies, as its newest member.
• The EU's Technical Expert Group on Sustainable Finance is calling for feedback on a first outline of the anticipated taxonomy.
• For the first time, the European Central Bank included climate risks in its risk assessment published for 2019.
• China and London published a set of principles on green investments for the Belt and Road Initiative, which aim to incorporate low-carbon and sustainable development into the Belt and Road Initiative.

Market trends

• In this year’s pension fund rating conducted by SonntagsZeitung and Finanz und Wirtschaft, NEST Sammelstiftung received two awards, with a top-ranking both in the return on investments category as well as in the sustainability category.
• The pension fund of the city of Zurich has declared its plan to drop coal and reduce the carbon footprint of its portfolio by half until 2024.
• Shell plans to link executive pay to climate targets, as announced prominently in a joint statement with Climate Action 100+ at COP24 in Katowice, Poland.
• The Seychelles have launched the world’s first sovereign blue bond, designed to support sustainable marine and fishery projects.
• ING has issued the largest green bond by a European bank, totalling USD 3 billion.
• FTSE Russell has partnered with Sustainalytics, the ESG research company, to develop a new set of ESG indices for companies based on the Russell 1000, 2000 and 3000 rankings.
• The verification of impact processes and quantification is taking centre stage with the IFC Operating Principles for Impact Management open to consultation and Gold Standard creating a new company SustainCERT specialized in impact certification.

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• 13 December, NZZ, Schweizer Investoren machen Indexanbietern Feuer unter dem Hintern
• 12 December, finews.ch, Pictet im Kampf gegen Waffenhersteller
• 8 December, Financial Times, Index groups face fight over controversial weapons
• 7 December, Le Temps, La pollution, un dilemme financier pour les pays émergents
• December Edition, Ticino Management Donna, Parità come opportunità (extensive report on SSF event)
• 3 December, Tagesanzeiger, Versicherer tun wenig für Kohleausstieg
• 27 November, NZZ, Nachhaltiges Anlegen: so funktioniert und wirkt es
• 14 November, Tagesanzeiger, Klima und die Rolle der Banken
• 12 November, SRF Eco, Das Geld der Frauen
• 11 November, Le Temps, L’engagement de la finance en faveur de la planète est irréversible
• 2 November, swissinfo, Swiss pension funds feel society’s pull
• 1 November, Bilan, Nouvel outil d’e-learning sur l’investissement durable
• 25 October, NZZ, Nachhaltige Investitionen sind für den Schweizer Finanzplatz eine grosse Chance
• 10 October, Corriere del Ticino, Coinvolgere di più le donne

Visit our website for more articles and regular updates

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We are happy to welcome the following organisations as new SSF members:

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Upcoming SSF Events

• 16 January 2019, SSF and NCFA Event, Launch of natural capital risk framework for financial institutions, Zurich
• Save the date: 3 and 4 June 2019, Launch of SSF market study, Zurich and Geneva
• Save the date: 19 June 2019, SSF Annual event, Berne

Other Events

• 22 January 2019, SNBS 2.0 Hochbau: Bauen für eine neue Generation, Zurich (SSF President Jean-Daniel Gerber will give a presentation)
• 20-22 January 2019, Faithinvest Conference: Building Bridges, Geneva
• 23 January 2019, Schweizer Finanzmesse (Rountdable on the SDGs), Zurich
• 12-13 June 2019, TBLI Conference Europe 2019, Zurich

Further events are listed on the SSF website

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• November 2018: Eurosif published the 8^th edition of its SRI study, revealing sustained growth for most sustainable and responsible investment strategies.
• November 2018: In Rethinking Impact to Finance the SDGs, UNEP FI reviews the scope and nature of the financing gap for sustainable development.
• October 2018: US SIF published its biennial Report on US Sustainable, Responsible and Impact Investing Trends. The study found that SRI now accounts for one in four dollars of total assets under professional management in the United States.
• October 2018: UN Environment, with support from the Swiss Federal Office for the Environment (FOEN), published a study on Green Digital Finance. Mapping Current Practice and Potential in Switzerland and Beyond. The paper provides options for a number of national and international actions that could be taken forward by different stakeholders.
• October 2018: A Barclay’s report on sustainable investing and bond returns showed that applying ESG factors resulted in a small but steady performance benefit and no evidence of a negative effect.
• October 2018: A recent UN PRI report called Why and how investors can respond to income inequality identifies three themes material to long-term investors and suggests paths that investors might take to adopt a more balanced view of how to create value.
• October 2018: An academic working paper on Public Sentiment and the Price of Corporate Sustainability suggests that public sentiment influences investor views about the value of corporate sustainability activities and thereby both the price paid for corporate sustainability and the investment returns of portfolios that consider ESG data.

Read these and other reports in our Digital Library on Sustainable Finance

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