Published online by Cambridge University Press: 30 October 2020
The industry of Sustainable and Responsible Investments funds started booming after the financial crisis. The loss of faith in conventional finance made people look for 'other' values for their savings. A need for enhanced transparency popped up and suddenly most players in the financial system offered such products. Or did they? It became difficult not to get lost in an alphabet soup of 'sustainability' related acronyms, and it became more difficult not to get confused and make a valid choice. After different players and even government actors started launching such labels, comparability issues cropped up, adding a further layer of complexity for retail investors. French, Luxembourgish, German, Austrian labels came to the fore with no European framework to facilitate the comparison, except for a methodology based on transparency standards developed by the European Forum for Responsible Investment - Eurosif. The lack of generally accepted definitions for these sustainable funds did not help resolve the fragmentation of standards which abounded in the industry. European Institutions stepped in to facilitate sustainable finance and put some solutions on the table.
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