Finance: Banks and Financial Services
This is a methodological document aimed at clarifying how Mirova takes into account sustainable development issues in the framework of the environmental, social and governance analysis of each sub-sector of activity.
The financial sector has always been a necessary intermediary in market economies not only because it enables the financing of existing assets but also because, through its allocation strategies, it contributes to frame our economies and their level of sustainability. At Mirova, we believe that finance should not be considered neutral: the industry’s ability to leverage on sustainability is tremendous. As public scrutiny faced by financial companies rises, responding the unveil of malpractices during the 2007-2008 financial crisis, Banks and Financial Services companies are likely to adopt more sustainable behaviours. While the macro-economic environment has become challenging for a part of banks’ activities, especially lending due to the low-interest policies, banks have remained dynamic through their Corporate Investment Banking branches.
Since the Paris agreement and the adoption of the Sustainable Development Goals (SDGs) agenda, stakeholders have increased their focus on the analysis of the financing of sustainability and especially as regards the fight against climate change. Biodiversity is a more complex issue to measure and to integrate, on which banks will have to catch up rapidly. From ESG risks to financing sustainability and improving financial inclusion, the challenges are pivotal for the future banks’ strategie
Industries: retail and commercial banks, wealth and asset management (that might be linked with insurance activities), corporate finance and banking, global capital markets. All these activities can be included in the model of universal banks, that often also include specialized financial services (consumer credits, mortgages)