Banque de France

Banque de France News : Climate & SRI

The Banque de France launches its Center on Climate Change (CCC) and publishes its 3rd Responsible Investment report

The Banque de France acknowledges the importance of the climate challenge and wishes to integrate ambitious actions to tackle it into its corporate strategy. For this reason, the Banque de France implemented the creation of its Climate Change Center, a close monitoring of all of its initiatives, to ensure their proper coordination, and strengthen even more so its capacity to act in the financial system in the broad sense.

The Center will play the role of a hub for all the actions undertaken by the various departments in the fight against climate change and will ensure their coordination. In particular, in the context of the plan Build Together 2024 (a new corporate strategic plan recently announced), the aim is to strengthen the effectiveness of the Banque de France’s action by relying on dedicated expertise and contributing to the development of synergies. The Center will also ensure the coordination of initiatives with the priorities of the Network for Greening the Financial System (NGFS), an international initiative for which the Banque de France has provided the secretariat since its launch in December 2017.

Economists will be associated with the center on climate change. The Climate Change Center will be operational from April 1, 2021.

In addition, since 2018, the Banque de France has implemented a responsible investment approach (RI) on its asset portfolios for which it has full and entire responsibility: portfolios backed by its own funds and pension commitments, representing 23 billion euros in total.

The Banque de France’s RI strategy is structured around three axes: a climate axis aligned with the 2015 Paris Agreement, an environmental social and governance axis (ESG), and a shareholder engagement axis.

In its latest report, the Banque de France indicates that in 2020, it achieved all of its objectives, improved its climate and ESG performances, and strengthened its strategy:

  • Objectives achieved: equity portfolio dedicated to equity aligned with 2°C, TEE (Ecological and Energy Transition) investments of more than 1.7 billion euros, 20% ESG exclusions (Environmental, Social and Governance issues) , attendance rate at general meetings of 90%.
  • Improved climate and ESG performance of portfolios: for example, with regard to the equity side of the portfolio dedicated to equity, -51.5% of tonnes of carbon equivalent per million euros invested and -41.4% of exposure to fossil fuels.
  • Strengthening of the strategy: tightening of exclusions in terms of fossil fuels with in particular the announcement of an exit from coal by 2024 at the latest, analysis for the first time of the biodiversity impact of portfolios, strengthening of the social component of the strategy.

The 3rd annual responsible investment report (2020) is available here

Source: Banque de France

Post Author: Wealth Monaco