Green finance: Will the new European regulations be enough to smother allegations of ESG-washing?

by Louis Fauconnier

The European Union (EU) became a signatory of the Paris Agreement in 2016, which set out the ambitious goal of keeping global warming below the threshold of 2°c compared to pre-industrial levels; and the EU vowed to shape a greener, fairer, cleaner Europe that would lead the way and show an alternative that few people and even fewer countries believed in: that de-industrialisation is not needed to transition towards a sustainable economy. The EU Green Deal, presented by Ursula von der Leyen in 2019 and adopted by the European Commission in 2020, proved that the EU, which was always seen as a pioneer in the fight against climate change with a history of bold and innovative legislation, once again had laid out a cohesive plan to meet its goals of: (i) reducing its greenhouse gas emission by 55% below 1990 levels by 2030; and (ii) becoming a carbon-neutral continent by 2050.