Book contents
- The Cambridge Handbook of EU Sustainable Finance
- The Cambridge Handbook of EU Sustainable Finance
- Copyright page
- Contents
- Figures
- Tables
- Contributors
- Preface
- Acknowledgements
- Part I Introduction
- Part II Ethics and Sustainability in Corporate Law, Corporate Governance and Conduct
- Part III Integrating Sustainability in Financial Markets Regulation
- 10 Sustainability-Related Materiality in the SFDR
- 11 Information Intermediaries and Sustainability
- 12 On the Sustainability of the MiFID II and IDD Investor Protection Frameworks
- 13 The EU Taxonomy Regulation and the Prevention of Greenwashing
- 14 Integrating Sustainable Finance into the Prospectus Regulation
- 15 Disclosure Regulation and Sustainability
- 16 Institutional Investors as the Primary Users of Sustainability Reporting
- 17 The Role of Non-Financial Disclosure and Liability in Sustainable Finance
- Part IV Ensuring Financial Stability and Sustainability
- Part V Financial Innovation and Sustainability
- Index
- References
16 - Institutional Investors as the Primary Users of Sustainability Reporting
from Part III - Integrating Sustainability in Financial Markets Regulation
Published online by Cambridge University Press: 30 January 2025
Book contents
- The Cambridge Handbook of EU Sustainable Finance
- The Cambridge Handbook of EU Sustainable Finance
- Copyright page
- Contents
- Figures
- Tables
- Contributors
- Preface
- Acknowledgements
- Part I Introduction
- Part II Ethics and Sustainability in Corporate Law, Corporate Governance and Conduct
- Part III Integrating Sustainability in Financial Markets Regulation
- 10 Sustainability-Related Materiality in the SFDR
- 11 Information Intermediaries and Sustainability
- 12 On the Sustainability of the MiFID II and IDD Investor Protection Frameworks
- 13 The EU Taxonomy Regulation and the Prevention of Greenwashing
- 14 Integrating Sustainable Finance into the Prospectus Regulation
- 15 Disclosure Regulation and Sustainability
- 16 Institutional Investors as the Primary Users of Sustainability Reporting
- 17 The Role of Non-Financial Disclosure and Liability in Sustainable Finance
- Part IV Ensuring Financial Stability and Sustainability
- Part V Financial Innovation and Sustainability
- Index
- References
Summary
A fundamental pillar of the European Commission’s Strategy for Financing the Transition to a Sustainable Economy, harmonized sustainability reporting is functional to giving substance to a company’s sustainability endeavors, to identifying a shared classification system for sustainable activities, to tackling greenwashing, and to helping institutional investors meet the disclosure obligations they, in turn, are imposed on by the SFDR. While institutional investors remain the main users of corporate sustainability disclosures, yet sustainability reporting facilitates interaction between investors and other stakeholders, such as NGOs, as a lever by which to enhance stakeholders’ voice and overcome the limited ability of broadly diversified institutions, especially passive fund managers, to actively monitor portfolio firms and reduce systematic portfolio risk. In order for EU sustainability reporting to deliver on its promises, two factors are crucial. First, the current fragmentation of non-financial reporting standards based on different frameworks and, particularly, on diverging notions of materiality, should be overcome. Second, an adequate balance between the narrative and quantitative dimensions of sustainability reporting should be struck in order not only to make sustainability disclosures meaningful for its users, but also to allow for mutually connecting, and achieving coordination between, financial and non-financial information.
Keywords
- Type
- Chapter
- Information
- The Cambridge Handbook of EU Sustainable FinanceRegulation, Supervision and Governance, pp. 431 - 448Publisher: Cambridge University PressPrint publication year: 2025
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