Blog

10 October 2018

Sustainable finance: what’s it got to do with accountants? By Vita Ramanauskaité and Eleni Kanelli

This is the first blog post of our sustainable finance series. Check out the second part here: Radical change to fight our environmental crisis 

 

Global goals for a greener planet

To keep Europe liveable for all 512 million of us, we will need a more sustainable economy. Having committed to the UN Sustainable Development Goals and the Paris Climate Agreement, Europe needs to fulfil an ambitious agenda by 2030. To this end, the EU launched a massive Sustainable Finance initiative to stimulate the €180 billion annual investment needed to merely achieve its energy and climate goals. This is part of the EU’s legislative efforts to establish a Capital Markets Union to which Accountancy Europe has steadily contributed.

Source: https://ec.europa.eu/info/files/180524-sustainable-finance-factsheet_en

 

How do accountants contribute?

Accountants provide transparency that is essential for the stability of Europe’s financial system and for moving from short-term investments to sustainable economic growth. What gets measured gets done, so accounting is a natural starting point. Measuring pollution, resource depletion and global warming will correct market failures, and this will drive a truly sustainable economy and should deter ‘greenwashing’. Businesses also perform better when they report on sustainability matters; they are more likely to identify long-term risks and build resilience into their business models.

Accountants contribute via their daily work­ in 3 primary ways:

  • Corporate reporting to cover long-term term risks: Financial performance is not enough to determine how a company will develop in the long run. Non-financial information, including sustainability information, plays an important role in mitigating the short-termism that until recently dominated financial analysis and valuation. Accountants can help companies connect, and eventually integrate non-financial and financial information.
  • Corporate governance to focus on long term value creation: With companies as the main driver for economic change and their key role in natural capital and geopolitics, accounting and measuring is a tool for to make businesses more sustainable. They help embed sustainability into a company’s strategy, decision making and reporting processes.
  • Auditing to provide trust to stakeholders: Accountants provide independent assurance to address stakeholders’ needs for reliable corporate information. They have the skills and abide by the high-quality global standards to increase trust. They enable businesses to achieve their sustainability objectives by identifying areas for improvement and enhance internal decision-making processes.

 

20 years of experience supporting sustainable financial growth

We have continuously advocated financing sustainable growth and supported long term investments for the past two decades. Next to our recent publication Sustainable finance. The accountancy profession’s contributions to EU strategy and our contributions on the Capital Markets Union, we have worked extensively on the following topics:

 

Related content

Blog7 ways accountants can help companies get more sustainable

24 April 2019

BlogRadical change to fight our environmental crisis

22 February 2019

BlogLooking back, moving forward: our sustainable future starts today

16 January 2019

EventSustainable tax system: towards a green future

25 October 2022

UpdateSustainability

23 September 2022

Consultation responseIPSASB’s consultation on advancing public sector sustainability reporting

9 September 2022

Stories from practiceInsights from SME accountants: taking up the sustainability challenge to help SMEs

29 August 2022

NewsEuropean sustainability reporting standards: shaping EU’s green future

22 August 2022

Stories from practiceInsights from SME accountants: from professional sports to environmental accounting

9 August 2022

Consultation responseLetter to Commissioner McGuinness on EFRAG’s draft ESRS

29 July 2022

Consultation responseEFRAG PTF-ESRS exposure drafts on European sustainability reporting standards

29 July 2022

Consultation responseISSB’s Climate Exposure Draft

28 July 2022

Consultation responseISSB’s General Requirements Exposure Draft

28 July 2022

Stories from PracticeInsights from SME accountants: practitioners help SMEs go green

25 July 2022

UpdateSustainability

4 July 2022

NewsEU reaches agreement on the CSRD: a historic moment for corporate reporting

30 June 2022

EventSustainability assurance under the CSRD: practical implications

22 June 2022

EventESG & Corporate Governance: the evolving role of audit committees

20 June 2022

Consultation responseUS SEC’s climate-related disclosures proposed rule

17 June 2022

Consultation responseEC’s consultation on new EU system for withholding taxes

17 June 2022

UpdateSustainability

9 June 2022

EventESEF in practice 3: sustainability

30 May 2022

Consultation responseEC’s corporate sustainability due diligence proposal

20 May 2022

Sign up for our newsletter

* indicates required
Would you like to subscribe to our newsletter?
On which topics would you like to receive news?