HeavyFinance boss says new sustainability standards “will help fight toward net zero”
The co-founder of European peer-to-peer lending platform HeavyFinance, Laimonas Noreika, has said that a new, global sustainability reporting framework will help organisations to put “environmental, societal and governance (ESG) higher on their agendas.”
The International Sustainability Standards Board (ISSB) has launched its first sustainability-related reporting standards with backing from regulatory bodies, including the Financial Conduct Authority. The UK government has also signalled support for the ISSB and said it would be establishing a mechanism for formal endorsement and adoption of the standards soon.
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“It is great to see that the ISSB standards are finally being introduced as sustainability factors become a more mainstream part of investment decision-making,” Noreika said.
“Such standards will help facilitate and promote the efficiency of capital markets, their transparency and accountability in turn building trust, and will enable them to reduce risks across their supply chain. Sustainability reporting yields significant cost savings, and highlights where many organisations may lack, bringing ESG higher on their agendas.
“As the FCA are key influencers in regulatory decisions to help meet the needs of capital markets and public interest, their support will overall aid in the ISSB’s adoption around the world and play a significant step in the fight toward net zero.”
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Investment industry stakeholders have long called for standardised metrics for ESG. The lack of clarity around the benchmarks has led to widespread ‘greenwashing’, whereby investment firms and companies claim to be more environmental or ethical than they actually are, in order to tap into the growing ESG trend.
The FCA has deemed the new standards a “game changer” for the industry.
“At its launch at COP26 in November 2021, our chief executive, Nikhil Rathi, referred to the ISSB as a ‘game-changer’ – and what we’ve seen over the past 18 months or so is that he was absolutely right,” said Sacha Sadan, director of ESG at the FCA.
“We have been working closely with the ISSB since the start and are hugely supportive of its mission to create a common, global language for companies around the world to communicate their sustainability stories in a consistent and comparable way. That is why we are delighted to see the final standards launched today.”
The FCA said that the ISSB sustainability standards “answer the clear market demand for complete, consistent, comparable and reliable corporate sustainability disclosures.”
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