The importance of sustainability certifications for banks and their role in CO2 reduction

The importance of sustainability certifications for banks and their role in CO2 reduction

sustainability in the banking sector is more important

The importance of sustainability for banks and financial service providers continues to increase. According to a current study by the professor of marketing and international management, Prof. Dr. Nicole Fabisch, sustainability is not only a megatrend in politics and society, but also a topic that has to be taken into account more by banks. Although many banks have been committed to sustainability, there is still a lack of verifiability, transparency and data. How can these weak points be remedied?

The financial services industry plays a crucial role in promoting a low-CO2, resistant and resource-efficient economy, as required by the Federal Financial Supervisory Authority (BAFIN). In Germany in particular, where over 90 percent of companies are small and medium-sized companies and are often bound to house banks, banks have a significant impact on the economy through lending and other financial products. According to the Bundesbank, the total assets of German banks have increased continuously in recent years and reached a record of 10.583 trillion euros in 2022. If Öko-social award criteria were used in this context, this could set a clear impulse.

The EU has already issued guidelines for sustainability, including the Principles for Responsible Banking, which were signed by 300 banks. However, critics criticize that this is only a commitment. There is a lack of verifiability and sanctions in the event of non -compliance, which allows the accusation of so -called green water.

In order to counteract these challenges, regulations and reporting are necessary. The EU Faxonomics Ordinance, which came into force in 2020, is intended to create clearer guidelines for investors and contain greenwashing. From 2022, companies that are obliged to report non-financial reporting must provide information on their efforts in the area of ​​climate protection and adaptation to climate change. From 2023, further environmental protection goals such as circular economy, protection of water and sea resources and measures to protect the biological diversity must be integrated. The EU regulation is also supplemented by a social category that aims to direct capital flows in companies and business activities that respect human rights. In addition, the Green Claims Directive was adopted in March 2024, which prescribes stricter and verifiable requirements for the communication of environmental properties of products or companies.

In order to make sustainability reports more transparent and comparable, the EU came into force in 2022. In the medium term, companies are no longer only affected by considerable public importance, but also medium -sized companies. The "double essentials" are essential innovations, in which both the effects of the company on the environment and society as well as financial effects must be reported.

Overall, there is still a lot of development potential in terms of sustainability in the banking sector. So far, only a few universal banks have been proactively acting in this area. It is recommended that the EU introduce further regulatory requirements to improve the sustainability efforts. In addition, holistic sustainability seals and rankings can ensure more comparability and transparency.