The European Investment Bank (EIB) recently released the extensive research conducted by the Vienna Initiative working group on climate change and financial stability, entitled Greening the financial sector: A Central, Eastern and South-Eastern European perspective.
The report provides valuable insights and recommendations on navigating the complexities of climate-related risks and fostering sustainable financial practices across Central, Eastern, and South-Eastern Europe (CESEE).
The study highlights the significant impact of limited environmental, social and governance data availability in CESEE, which reduces banks' ability to effectively manage climate risks and undermines effective prudential supervision.
While large corporations within the European Union have successfully adapted to robust disclosure requirements and are meeting the increasing demands of environmental, social and governance standards, companies — especially microenterprises and small and medium-sized enterprises (SMEs), which are prevalent in the region — often lack the information and awareness needed to understand the climate and financial risks they face.
EIB Vice-President Ambroise Fayolle said: “The report underscores the critical role of the financial sector in driving the transition to a more sustainable economy and achieving the European Union’s green transition goals. Coordinated efforts to unlock the potential of sustainable finance in the CESEE region are crucial for driving sustainable development. As the EU climate bank, the EIB is fully committed to providing continued support to businesses and facilitating the transition to renewable resources.”
