24.04.2023 // General news
Sustainability in the financial sector
Sustainability aspects are also very important in the financial sector today. For several years, there have been a variety of ongoing international initiatives to improve factors such as transparency in financial investments. This circumstance is currently reflected in the drafting of new laws and industry regulations for the financial markets. To provide holistic support to companies, the responsible ISO technical committee 322 developed standard 32210, which was published in October 2022. The guideline aims to support companies in transitioning to a more sustainable financial sector. It does so by presenting the comprehensively strategic and organisational embedding of sustainability principles for financial service providers in a systematic and impact-oriented manner.
The standard is based on a normative document issued by the British standards institute BSI, which was transposed into an international ISO standard within three years. ISO 32210 shows organisations in the financial sector ways of improving their sustainability. It encourages them to participate in or follow global initiatives such as the United Nations 2030 Agenda for Sustainable Development or the Paris Agreement to protect the climate. The standard also defines how the fundamental principles of sustainable finance can be integrated into day-to-day operations. It has been designed to be applicable globally. Organisations that are at different stages of integrating sustainability can also apply only parts of the standard or derive more far-reaching measures from it.
A duty for the financial sector
Alongside financial institutions and intermediaries, other actors and stakeholders in the financial sector can also use ISO 32210. These include, for example, institutional investors, financed companies, industry associations, government financing organisations and financial market regulatory authorities. The ISO working group “Sustainable finance products and services” was set up to determine the precise structure of financial products and services with a sustainability focus. It began its work last year.
Green on the outside not always green on the inside
Swiss SNV expert Franz Knecht was actively involved in the development of the standard and sees the primary benefit of the ISO standard in its binding nature for users and their stakeholders. “ESG – Environment, Social and Governance – has become the catch-all for the sustainability performance of companies in all sectors. The feedback we received on the draft standard concentrated on issues such as greenwashing, a lack of specific information, and the desire for labels with real meaning. Topics that the consumer goods sector has been discussing for years, in fact. That is because things are by no means always as green as they seem. It therefore comes as no surprise that politicians and ratings agencies are joining NGOs in calling for financial products also to be regulated according to ESG criteria.”
You are invited to participate!
ISO 32210:2022 is not the first standard to be issued by ISO standards committee ISO/TC 322 Sustainable Finance, and it will not be the last. By joining the Swiss Association for Standardisation (SNV), Swiss experts can play an active part in determining ISO standards associated with sustainable finance. Become a member of the national mirror committee to ISO/TC 322, INB/NK 174/UK 322 “Sustainable finance”.