The European Commission High-Level Expert Group on Sustainable Finance (HLEG), published their final report

with strategic recommendations for a financial system that supports sustainable investments. They serve as a basis for the Commission’s yet to be defined strategy for sustainable finance - also having huge implications for Switzerland. Delivering an EU strategy on sustainable finance is a priority action of the Commission's Capital Markets Union (CMU) Action Plan, as well as one of the key steps towards implementing the historic Paris Agreement and the EU's Agenda for sustainable development. The financial sector has a key role to play in reaching those goals, by mobilising private capital for sustainable investments.

The HLEG proposals include mandatory disclosures on sustainable investment strategies, labels for green investment funds and green bonds and a call to make sustainability part of the mandate of the European Supervisory Authorities. With such a far reach they cannot be ignored by the Swiss market place. To remain competitive, Swiss players will need to evaluate how to best benefit from and adapt to the changing environment.

The European Commission is determined to help investors select sustainable projects and companies, which directly impacts the private wealth management market, where the Swiss financial centre plays a leading role. In Switzerland we see movement in this direction with the recent emissions of two green bonds by the State of Geneva, showing that sustainable finance is gaining momentum within our institutions.

Ensuring that Switzerland leverages the current dynamics to further embed sustainability in financial decisions is becoming more and more strategic and urgent. Given the recognized expertise of Swiss players, as well as the growing support from political actors, this is not just a vision for the future, but an opportunity for today.

Kind regards,

Jean Laville

Deputy 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

Varia from our network

SSF hosts first full-day event on inspiring investment partnerships

At SSF's first international conference in Zurich on 16 January, some 240 participants from 12 countries seized the opportunity to inform themselves about innovative partnerships for development investments. In her keynote speech, Karin Finkelston, Vice President Partnerships, Communications, and Outreach at the International Finance Corporation (IFC), presented concrete examples illustrating how private investment can improve livelihood while delivering attractive returns. This was followed by panel discussions reflecting the role of both the public and private sector in making cooperations for such partnerships successful. 

SSF and CFA Institute Research Foundation co-publish the Handbook on Sustainable Investments in English

An expanded chapter on impact investments and a new chapter on integrating sustainability into commodity investing complement the overview on current best practice in sustainable investing aimed at institutional asset owners and other finance professionals. This handbook is the result of a close collaboration with over 30 expert authors and contributors. Sign up for the launch event on 27 February in Zurich.

Download the English Handbook here.

SSF present at FINANZ’18 and IMMO’18

SSF was happy to contribute to two mainstream finance events, supporting our goal to make sure sustainable finance reaches a broader audience.

At IMMO’18, SNBS, in partnership with SSF, held an event on the role of the new Swiss standard on sustainable building SNBS 2.0 (Standard nachhaltiges Bauen Schweiz) for real estate investors. SSF was represented by our Board Member Patrick Fankhauser, who gave his view on the impact sustainability aspects have on property valuation and the growing significance real estate investors attribute to it.

Read more on these events.

SSF launched survey on sustainable investment in Switzerland

In preparation of the official Swiss sustainable investment study 2018, SSF prepared a questionnaire jointly with the Market Study Workgroup and sent this out to a broad set of asset managers and asset owners. The deadline for respondents is 9 March, whereafter the results will be aggregated and interpreted with the support of the University of Zurich.

SSF participated in public consultation of European Commission on institutional investors and asset managers' duties regarding sustainability

As a representative of the Swiss sustainable finance market, SSF participated in a consultation on institutional investors’ and asset managers’ duties regarding sustainability. Together with the newly released final report of the HLEG, the results of the consultation will support the European Commission in formulating its strategy on sustainable finance. After having requested feedback from SSF members and network partners, SSF consolidated the answers and submitted the final survey mid-January 2018.

Download SSF’s final submission here.

Read more about these and other SSF activities

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Swiss news

• The Genevan Public Pension Fund (La Caisse de prévoyance de l'Etat de Genève - CPEG) is the first Swiss pension fund to join the Institutional Investors Group on Climate Change (IIGCC). The management is convinced that fiduciary duty now also entails taking an active stance with regards to climate change and the low-carbon energy transition.
• The FINEXUS Center at the Banking and Finance Institute (University of Zurich) hosted the FINEXUS 2018 Conference “Closing the Gaps Between Finance and Sustainability”, featuring Joseph E. Stiglitz (Columbia University) among the more than 70 speakers and 350 participants. The three-day conference included both practitioner and academic sessions seeking to narrow current gaps between analytical methods, financial instruments and governance processes.
• The canton of Geneva has reported positive results from its first issuance of a green bond in November 2017 and considers issuing more of the same during the next two years. The green bond has attracted new lenders such as pension funds or specialized funds.

International initiatives

• The High-Level Expert Group on Sustainable Finance (HLEG) has released its final report to support the European Commission in drafting an EU roadmap on sustainable finance by March 2018. The eight recommendations below have elicited mixed reactions, some EU pension funds perceiving them as too prescriptive and other entities viewing them as too cautious:

1. Establish and maintain a common sustainability taxonomy at the EU level
2. Clarify investor duties to better embrace long-term horizon and sustainability preferences
3. Upgrade disclosure rules to make sustainability risks fully transparent, starting with climate change
4. Key elements of a retail strategy on sustainable finance: investment advice, ecolabel and SRI minimum standards
5. Develop and implement official European sustainability standards and labels, starting with green bonds
6. Establish ‘Sustainable Infrastructure Europe’
7. Governance and Leadership
8. Include sustainability in the supervisory mandate of the ESAs and extend the horizon of risk monitoring.

• Seven European countries will publish a coal exit strategy during 2018. The UK has presented its strategy on January 5, while the pending strategy of France is expected to also include nuclear phase-outs.

Market trends

• There is currently a funding gap of USD 2-3 trn for achieving the Sustainable Development Goals (SDGs) in 2030. The Blended Finance Taskforce of the Business & Sustainable Development Commission believes that blended finance could provide up to USD 1 trn, as opposed to the USD 50 bn of the public and private mixed capital available now.
• The Mayor of the city of New York has announced a USD 5 bn divestment from fossil fuels within the next five years. Furthermore, the city has filed a law suit against the five largest oil companies for causing climate change, which affects the city. Similarly, the city of San Francisco, having previously also filed a lawsuit, now vows to invest USD 1 bn into carbon-constrained investment instead of divesting USD 559 mn from fossil fuels, as declared in 2013.
• The Dutch civil pension scheme ABP will stop investing in tobacco and nuclear weapons; its estimated holdings of € 3.3 bn are to be sold by the end of 2018. Reason for this decision is a new assessment framework, stating that if a product was intrinsically harmful to humans and shareholder engagement could not bring betterment, ABP needs to divest.
• The Swiss company RepRisk has won an important mandate for the USD 1 trillion Norwegian Government Pension Fund Global. It was chosen by the fund’s Council on Ethics to help monitor companies that might conflict with the wealth fund's ethical guidelines.
• Rating agencies Moody’s Investors Service and S&P Global Ratings are both considering including more data on disaster forecasting to rate government and corporate bonds in affected industries. This should lead to more adequate representation of risks.
• During the World Economic Forum in Davos, UBS announced its cooperation with the World Bank in investment portfolios to achieve its goal of USD 5 bn invested into sustainable projects by 2030. Furthermore, UBS partnered with the City University of New York (CUNY) and Harvard to develop their new scientific framework. In a first test, it evaluates the environmental and health benefits of the USD 2.1 bn equity portfolio managed by UBS for the Dutch pension fund PGGM.

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• 6 February 2018, cash.ch, Nachlese zur Finanz'18: Reduce to the max (With mention of SSF moderated panel)
• 5 February 2018, Le Temps, Après un premier succès, Genève veut continuer à emprunter «vert»
• 30 January 2018, The Charter (CFA Society Switzerland), Shedding light on sustainable investment terminology (article by Sabine Döbeli)
• 21 January 2018, Le Temps, La responsabilité du capital
• 17 January 2018, Finanz und Wirtschaft, Wie Geldanleger die Welt verbessern
• 17 January 2018, Echo der Zeit (Radio SRF), UNO sucht private Investoren
• 17 January 2018, Giornale del Popolo, Investimenti “sostenibili” per un’economia circolare
• 16 January 2018, L’AGEFI, Finexus accentue sa présence publique
• 16 January 2018, NZZ, Larry Fink setzt auf Langfristigkeit
• 12 January 2018, Le Temps, Stefano Battiston: «Dans la finance durable, il y a aussi beaucoup de marketing»
• 9 January 2018, NZZ, Mit Frauenförderungs-ETF auf Kundinnen-Fang
• 18 December 2017, Tagesanzeiger, Grossinvestoren setzen Klimasünder unter Druck

Visit our website for more articles and regular updates

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We welcome the following organisations as new SSF member and network partner, respectively:

• 27 February 2018, Swiss Sustainable Finance, CFA Society Switzerland and CFA Institute Research Foundation, Launch Event for English edition of SSF Handbook on Sustainable Investments, Zurich
• 28 February 2018, Banque Alternative Suisse, Débats d’archent: Sociaux, durables, innovants, Lausanne
• 27 March 2018, SFAMA and SSF, Sustainable Investments –  Doing good without sacrificing returns?, Zurich
• 28 March 2018, SFAMA and SSF, Sustainable Investments –  Doing good without sacrificing returns?, Geneva

Save these dates:

• 17 April 2018, PRI and SSF, Joint event to present recent PRI tools for institutional asset owners, Zurich
• 19 June 2018, Swiss Sustainable Finance, Annual SSF Conference, Bern 

Further events are listed on the SSF Website

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• February 2018: Standford researchers published the working paper Is “Being Green” Rewarded in the Market? An Empirical Investigation of Decarbonization and Stock Returns. The study looks at over 70'000 US firms between 2005 - 2015 and demonstrates that a carbon efficient portfolio pays off.
• January 2018: The HLEG has released its final report to support the European Commission in drafting an EU roadmap on sustainable finance.
• January 2018: OECD’s report, Making Blended Finance Work for the Sustainable Development Goals provides a thorough assessment of the current state and priorities for blended finance. It describes concepts and definitions, lays out the main actors and instruments and shares learnings from past experiences.
• January 2018: seif and BHP Brugger and Partners have jointly published the report Social Impact Bonds – ein Leitfaden für die Praxis, describing current best practices in the establishment of Social Impact Bonds as well as experienced challenges in a European environment. With this German publication, authors hope to initiate a discussion on both the risks and opportunities of issuing SIBs in Switzerland.
• January 2018: In their paper Swiss Legal and Tax Implications of Social Impact Bonds, Brunschwig & Fischer look at the legal implications of launching an SIB in Switzerland. Since Swiss issuances are still lacking references, the authors provide learnings of a recent SIB project by the International Committee of the Red Cross supported by SECO, amongst other donors.
• January 2018: Moxie Future has launched its first survey on the responsible investment behaviour of woman in their publication 2018 Understanding Female Investors – Women using capital to change the world. The survey was answered by 2536 women in Australia, China, Germany, UK and US, whereof respondents from China showed the highest interest in responsible investing.
• January 2018: The Blended Finance Taskforce of the Business and Sustainable Development Commission has published the consultation paper Better finance, better world to present the private sector perspective towards this topic. Still awaiting feedback from stakeholders until mid-March 2018, it will finalise a concrete action plan by late April 2018.
• December 2017: In its new Paper on the Implications of UN Guiding Principles 13b & 17 in a Corporate and Investment Banking Context, the Thun Group of Banks has attenuated its controversial claims with regards to the responsibility of banks for human rights issues. Instead, it focuses on situations where banks may be directly linked to negative human rights impacts under UNGP 13b.
• December 2017: The PRI has published an Investment Consultant Services Review with the aim to drive a deeper discussion about the inclusion of ESG issues as a standard part of consulting advice and which additional ESG integration investment services are needed. The report also sets out barriers to this practice and identifies preliminary interventions.
• December 2017: In The State of Impact Measurement and Management Practice, GIIN presents the findings of its first comprehensive survey of the state of impact measurement and management. It captures data from 169 impact investing organizations to provide valuable insights into why impact investors measure social and environmental impact, how they do so and challenges that remain.
• December 2017: The Global Green Finance Council issued the Global and European Green Finance Policy Directory to provide policymakers and global and regional market participants a simple, easy-to-use reference as to which international and regional governments and industry bodies have implemented or are implementing major green, sustainability and climate change initiatives.
• November 2017: In the research paper Foundations of ESG Investing – Part 1: How ESG Affects Equity Valuation, Risk and Performance, MSCI tackles the old question of correlation and causality by examining how ESG information is transmitted to the equity market. Using a standard discounted cash flow model, the authors provide evidence for a causal relationship between ESG and financial performance.

Read these and other reports

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University of Zurich is starting with the next round of its Certificate of Advanced Studies in Sustainable Finance (CAS SF) . The different courses running from 1 March 2018 through to 23 November 2018 can be chosen individually or can be combined for a full CAS program. They cover the areas of Sustainable Investing, Sustainable Banking and Insurance, Microfinance, Microinsurance and Emerging Market Finance. The courses combine academic training and research with current business practices, while promoting technical, methodological and social skills.

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