EBF PAPER

An EU framework for financing the transition

BRUSSELS, 17 February 2023 – The EBF has published a paper calling for a common transition finance framework to accelerate considerations on how to better consider transition at both activity level and entity level in order to enhance engagement with clients in a clear and comparable manner, based on a common framework that facilitates understanding transition trajectories and assessing progress over time.

What is needed at:

• At ACTIVITY LEVEL is to define which transition pathways should be used for each economic activity per industrial sector with possible national specificities where relevant. Such benchmark transition pathways should be science-based and aligned with both EU climate targets and the Paris Agreement objective. Sector transition pathways should be complemented by sector transition roadmaps.
• At ENTITY LEVEL is the standardization of corporate transition plans at entity level (with 7 components as suggested by EFRAG including a capex/investment plan) based on the relevant sectoral transition pathways (specified by the European Commission).  A common definition of both transition pathways, transition roadmaps and transition plans is important as they could be leveraged by financial institutions for client engagement.

For more information:
Denisa Avermaete, Senior Policy Adviser – Sustainable Finance, d.avermaete@ebf.eu

Alexia Femia, Policy Adviser – Sustainable Finance, a.femia@ebf.eu

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About the EBF:

The European Banking Federation is the voice of the European banking sector, bringing together national banking associations from across Europe. The EBF is committed to a thriving European economy that is underpinned by a stable, secure, and inclusive financial ecosystem, and to a flourishing society where financing is available to fund the dreams of citizens, businesses, and innovators everywhere.