Green Finance

Transparency and the issues around green investments, hologram NFTs, and the new greentech taxonomy

  • Transparency may not be enough to make banks focus more on sustainable investments.
  • Hologram NFTs are trying to save the oceans, GDFA launches the first greentech taxonomy, and more.
close

Email a Friend

Transparency and the issues around green investments, hologram NFTs, and the new greentech taxonomy

Tearsheet’s Green Finance newsletter is about the intersection of money and the environment. We’ll be in your inbox every other week, and share what we’re currently thinking about, and what’s been happening at three key areas in the intersection: corporate responsibility, blockchain, and green products and services.

To sign up for the Green Finance newsletter, subscribe here.

The green finance debate seems to be revolving around implementing climate impact disclosures for financial institutions to drive more ESG investments. But is transparency enough to make banks focus more on sustainable investments? A closer look suggests the issue is much more complex than that.

Transparency is important but not enough for a greener financial system

green finance

The financial sector is facing increasing pressure to reduce its support for the carbon-intensive sector, with banks’ lending practices getting more attention. 

The main response from government bodies and regulators is to upgrade financial disclosure requirements to include climate risks and impacts. This aims to increase investors’ responsibility by making them report on the climate impacts of their investment portfolios. 

However, the problem is much larger and more complex to solve than just shining a light on current practices

While enhanced disclosures are an important step towards a sustainable economy, they are insufficient to fuel a mass diversion of capital towards the clean energy sector given the current financial system’s infrastructure. The idea that once we can see where the money is going, we can redirect it to sustainable portfolios may not be entirely feasible. 

The issue with moving capital away from fossil fuels and towards clean energy is that the green investments market is still relatively small with low liquidity. Despite its rapid growth over the past decade, it’s still characterized by many small participants, often operating in only one market. This results in lower revenues and market capitalization, limiting renewables’ ability to attract investment. 

Read more

What we're reading

Corporate responsibility

ECB Says Every Bank Reviewed Falls Short on Managing Climate and Environmental Risk (ESGToday)

Convergence in Sustainability Reporting: The Fog Is Lifting (ESGToday)

Transparency of ESG investment ratings faces regulatory scrutiny (Reuters)

Blockchain

Jack Dorsey is now focused on 'Making Bitcoin more than an investment' (Bitcoin Magazine)

Cryptocurrency snaps up 2% of VCU carbon offset supply (Environmental Finance)

Hologram NFTs at Art Basel Miami Are Trying to Save the Oceans (CoinDesk)

Green products and services

Gránit Bank becomes first commercial bank to make Mastercard Carbon Calculator available to its customers (FFnews)

SoftBank, BlackRock Invest in Sustainability Data and Analytics Platform Clarity AI (ESGToday)

GDFA launches first ever green fintech taxonomy (Finextra)

0 comments on “Transparency and the issues around green investments, hologram NFTs, and the new greentech taxonomy”

Green Finance

A Klarna case study: Sustainability as a business value and as a value for business

  • Consumer products actively contribute to climate change, and ecommerce companies are playing their own role in worsening the climate.
  • Klarna isn't turning a blind eye to its corporate responsibilities, encouraging conscious buying which underscores its efforts to combat climate change.
Rabab Ahsan | September 26, 2023
Green Finance

Carbon credits have potential…. and potential problems

  • At our current of emissions we will surpass our carbon emission limits within the decade.
  • Banks have a crucial role to play in this emerging industry of carbon offsets, but there are rising concerns about efficacy and transparency in this nascent space.
Rabab Ahsan | August 21, 2023
Green Finance

Most consumers are willing to pay more for green finance products, but banks can’t differentiate them

  • Consumers are willing to put money where their convictions are when it comes to combatting the climate crisis.
  • However, limited understanding of product offerings and inability to differentiate in green financial products may be leading to an intention-action gap.
Rabab Ahsan | May 03, 2023
Green Finance

Doconomy acquires fellow Swedish fintech Dreams

  • Doconomy, a Swedish carbon data company that helps brands and consumers measure, understand, and reduce their carbon footprint - announced its acquisition of Dreams Technology.
  • The company plans to create a great digital experience that promotes financial wellbeing, encourages sustainable consumption choices and effectuates climate action at scale.
Iulia Ciutina | February 28, 2023
Green Finance, Member Exclusive

Tearsheet Briefing: ESG is at a crossroads

  • The role of finance and ESG in the battle against climate change is turning into a heated discussion across the political spectrum, with both parties aiming to encode their own agenda into law.
  • As the lines are being drawn, one thing is for sure - 2023 will bring a new wave of climate disclosures and regulation.
Iulia Ciutina | February 17, 2023
More Articles