Proposals for the future of the Sustainable Finance agenda
Nordic Financial Unions together with ShareAction and eight other prominent NGOs and trade unions across Europe have set out a joint vision on sustainable finance. The statement is road-map for next EU Commission and Parliament, and sets out common priorities and ambitions on EU:s Sustainable Finance Agenda from stakeholders. Read the contribution of UNI Europa Finance and NFU below:
The needs and perspectives of employees should play an important role in the process of creating and implementing financial legislation, including on sustainable finance. While financial sector employees are the ´face´ of the financial market to customers, they also have the capacity, together with trade unions, to act as catalysts in their work environments and carry the vision of sustainability.
– In the wake of the financial crisis, the EU rolled out a record number of new financial legislation. While, understandably, actions were needed to stabilize the financial market, ensure consumer protection and (re)build trust, the effects of the new requirements on employees remained largely unconsidered
– In addition to the pressure of compliance and new regulatory requirements, conflict of interest between good customer service and following rules and regulations was one of the main areas of concern for employees
– If the new requirements within the sustainable finance agenda are to be successfully implemented, the employee perspective and impact, as well as possible spill-over effects to the quality of customer service, need to be among ´top of mind´ considerations;
– For financial sector employees to play an active and positive role in the transition to sustainable finance, and to successfully work with compliance and implementation, they need to receive appropriate education and training;
– Lack of transparency and long-termism still remain as some of the biggest challenges in the financial sector´s transition to sustainable finance. Both financial sector employees and trade unions can be important stakeholders in the process of mindset shift;
– Digitalization and short-termism in the financial sector are also affecting access to finance. Digital exclusion leaves a big part of the European population behind, impeding their possibility to receive financial advice, seize possibilities to grow, and potentially contribute to the wider cause of sustainability. At the same time, this creates a burden on financial sector employees, as they face limitations in providing the advice that they would like to give.
A regulatory framework that empowers financial sector employees and trade unions to act as key catalysts in the creation of a sustainable finance system must:
– Include employee-focused impact assessments for all financial regulation, which can qualitatively assess the effects of proposed financial regulation on those involved in ensuring its implementation;
– Ensure employees have the right to provide advice reflecting the sustainability-related preferences of their clients, instead of advice leading to the selling of products linked to maximised profits;
– Ensure that all financial sector employees working in advisory functions have received adequate training on sustainability, including specialised dilemma training;
– Protect the right of customers to receive sound, personal financial advice, including as it relates to sustainability;
– Protect the rights of employees to “blow the whistle” on violations and discrepancies regarding the sustainability-related suitability of financial products;
– Ensure the representation of trade unions in the Permanent Platform overseeing the review and development of the proposed Taxonomy.
The full joint vision can be read here