11 June 2018

Investment & Pensions Europe: Austrian investors welcome EU’s sustainable investment proposals

Investors have welcomed the EC’s proposals for a unified framework for ESG investments, but have warned of challenges to achieving a consensus. At an annual gathering in Vienna of institutional investors from Germany, Austria and Switzerland, delegates discussed the commission’s sustainable finance proposals.

Martin Sardelic, chairman of the board at Austria’s Valida Holding, said he was “surprised at the speed” with which the commission had finalised the proposals.

“The paper contains a lot of sensible ideas, especially the common definition of standards but the interesting question will be to see whether nuclear energy will be excluded or not as France is playing a major part,” he added.

Several delegates agreed this was a problem, as the definition of sustainable investment varied widely between EU member state.

In Austria, for example, nuclear energy is an absolute no-go for ESG investors, while French investors consider it one of the most environmentally-friendly ways of producing power.

Robert Haßler, co-founder of the Oekom Research rating agency, highlighted that “in the high-level preliminary group preparing the proposals, no Austrians or Germans were represented”. He argued that this advisory group “in a way mirrored the correlation of power of European institutional investors in the ESG market”, with France, UK, the Netherlands and Nordic countries at the forefront.

Valida’s Sardelic welcomed proposals for more transparency for ESG investments, and the possible introduction of benchmarks. However, he warned the finance industry should observe carefully what would be required.

“For me it is surprising that the financial industry is singled out in the paper and is asked to bear a lot of responsibility,” Sardelic said, adding that there were “contributions the financial industry can make” but it should not be asked to do so on its own.

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