Sustainable finance in the EU: a pact with the devil?

Abstract

A key feature of the European Union’s Green Deal is its sustainable finance agenda, which seeks to bring sustainability considerations into the mainstream of financial decision-making, The aim is to direct financial flows towards the EU’s transition to a sustainable economy, relying on the contributions of private capital. The paper suggests that relying so heavily on the financial market actors without fully challenging the capitalist logic by which the sector operates, and without putting in place effective incentives and sanctions to steer their sustainability performance, is little more than a ‘nudge’ and is unlikely to ensure that the desired goals will be achieved. What we value and how we value are central considerations for sustainability. A more inclusive regulatory framework that embraces the priorities is required as is the participation of other stakeholders whose relationships with the environment and nature are more profound than measuring only for the sake of financial returns.