Sustainable Finance: The Regulatory Concept of Greenwashing under EU Law

Abstract

As the European regulatory tsunami in sustainable finance continues to gain pace, it is the year 2021 in which it seems to have approached the topic of greenwashing in full speed. The paper analyses greenwashing definitions in the new European sustainable finance regulations as well as related legislative documents and demonstrates that this previously generally unregulated field is now filled with new regulatory content. After conducting an in-depth analysis of the greenwashing definitions, the authors discuss core elements of the regulatory greenwashing concept under EU law and address various aspects of its impact on the banking practice. The essay concludes by placing the greenwashing concept into the general context of the EU’s new sustainable finance regulatory architecture and emphasizing that the fight against greenwashing also supports the primary legislative purpose of channelling investments into actually sustainable projects.