With a new online platform, Frankfurt School of Finance & Management and WWF Germany assess financial market regulation in Germany and the European Union with a focus on Green Finance. The finance fit for Paris tracker, made available on Thursday, evaluates laws and current measures against the imperative of the <2-degree target as anchored in the Paris Agreement. “Green Finance is still thought of as a niche topic. But it is essential to green the whole finance system to keep it stable against new risks, but also to ensure its contribution to national and international climate goals”, says Matthias Kopp, Head of Sustainable Finance at WWF Germany.
The 3fP Tracker screens and assesses the three areas of “Transparency & Disclosure”, “Supervision, Risk Management, System Stability” and “Enabling Environment”. The result is a score between 0 and 10 and the classification of the gap to meeting the requirements of the Paris Agreement. Initiatives like voluntary standards or non-binding policy statements are not included in the results.
“We want to show: How far along is the alignment of financial market regulations as a potential lever for more climate action. Also, what kind of laws are there and what do they accomplish? We can see that up till now the regulatory framework hasn’t contributed as much as it could. That’s why legislators should care for this topic. On a European level, this process has already begun”, says Karsten Löffler, Co-Head of the Frankfurt School-UNEP Collaborating Centre for Climate and Sustainable Energy Finance at Frankfurt School.
The 3fP tracker is designed for stakeholders in civil society, financial market actors, politicians and journalists. It is financed by the European Climate Foundation (ECF) and will add more countries in the months to come.