Switzerland must become one of the main world centers for sustainable financial services. The Federal Council and the industry presented a report on Friday that takes stock of the paths followed to achieve this.
“Change has been underway for a long time and Switzerland has unique expertise,” noted finance minister Ueli Maurer to the press. The financial center is distinguished by very close links between all market players which give it a competitive advantage.
Change has been underway for a long time and Switzerland has unique know-how.
Ueli Maurer, Minister of Finances
According to the report, thirteen measures could move Switzerland further on the road to sustainability. Among them, greater transparency: the financial sector must be transparent towards its customers and systematically publish comparable information on the climatic and environmental impact of financial products and companies.
Mark Branson, director of the Swiss Financial Market Supervisory Authority (FINMA), believes that greater transparency on risks is essential in the fight against greenwashing. A product sold as green must really be.
Assess the risks
The industry must also learn to correctly assess the price of risks, whether they are linked to natural disasters or to impairments of values. Future climate measures could lead to the depreciation of products linked to high CO2 emissions, for example.
Assessing the price of risk is very difficult, said Branson, the world is looking for a method and the process is underway. Additional regulation on this subject is not on the agenda, however.
According to Ueli Maurer, the industry is already going in the right direction and if we count three years for a bill, it would already be out of date by the end of the process. Bankers, insurers and wealth managers praised this approach and the report to the press.
The question is not whether the banks will embark on the path of sustainable development, but how and by when Switzerland will become a benchmark in this area, said the CEO of the Swiss Bankers Association Jörg Gasser. According to him, the impact of financial activities on global warming is a reflection of the real economy, not of branches in particular.
Ideally, each investment should take sustainability into account so that the goal of warming limited to 1.5 or 2 degrees can be reached, added Daniela Stoffel, Secretary of State for International Financial Affairs. In any case, Switzerland must avoid going it alone, stressed the various players.
The authorities and the sector are closely monitoring international developments, particularly in the EU, so that they can react early enough to maintain Swiss competitiveness. The sustainability of Swiss financial services must be visible internationally. The country systematically engages in international initiatives and in organizations such as the Financial Stability Board and the G20.
The financial sector will have to make efforts in terms of quality assurance. It must be distinguished by well-trained personnel who can offer products focused on the effective achievement of sustainable development objectives. Within the limits of its powers, the Confederation can offer its support, but the development of credible sustainability labels is a matter for the sector.
Disappointed climate alliance
For Greenpeace and the Climate Alliance, however, the approach chosen is bad. While the EU is working on binding regulations for the sector, the Federal Council is banking on its good will while the financial sector could make an essential contribution to meeting global climate targets.