{"id":91703,"date":"2022-10-17T09:56:54","date_gmt":"2022-10-17T07:56:54","guid":{"rendered":"http:\/\/euro-funding.com\/?p=91703"},"modified":"2026-04-07T09:18:45","modified_gmt":"2026-04-07T07:18:45","slug":"sustainable-finance-what-it-is-and-what-it-is-for","status":"publish","type":"post","link":"https:\/\/euro-funding.rwdesarrollos2.es\/en\/blog\/sustainable-finance-what-it-is-and-what-it-is-for\/","title":{"rendered":"Sustainable Finance: what is it and what is it for?"},"content":{"rendered":"\t\t
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Sustainable Finance:
what is it and what is it for?<\/h1>\t\t\t\t<\/div>\n\t\t\t\t
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Definition and characteristics of sustainable finance <\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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Already immersed in the early stages of the 21st century, participants in any sphere of society (including agents directly involved), may find themselves in their day-to-day lives with the doubt: “hey, what does that mean, Sustainable Finance?”<\/p>

Well, in short, it is the tool to align the economy with environmental and social responsibility<\/strong>. In short, it is to unite money and commitment to good practices, as a catalyst to achieve the goals set by this society of the 21st century.<\/p>

More and more investors are trying to combine their profitability objectives with the desire to use their money to improve the environment and society. The aim of this sustainable finance is to promote economic models in companies that favor respect for the environment, human rights, social justice and good corporate governance. There are several examples such as investment funds that apply ESG criteria, solidarity investment funds, green and social bonds, etc<\/strong>.<\/p>

As commented by Climate Policy Initiative (CPI) in its latest ‘Global Landscape of Climate Finance 2021’, annual flows increased to $632 billion (about \u20ac543.98 billion)<\/strong>, on average, in the period 2019-2020, which means an increase of $85 billion (more than 15%) (\u20ac73.169 billion) compared to the period 2017-2018.<\/p>

However, while sustainable finance has reached record levels, action still falls short of what is needed. Estimates of the investment required to meet climate targets of no more than a 1.5\u00b0C increase in global warming indicate that by 2030 annual climate finance must increase by at least 454%, to an average of USD 4.13 trillion (less than EUR 4 billion).<\/p>

XXX<\/span><\/p>

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How is sustainable financing regulated?<\/h2>\t\t\t\t<\/div>\n\t\t\t\t
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Sticking to the European level, we find the European Union (EU) Action Plan on Sustainable Finance and its three reference acronyms (SFDR, NFRD and EU Taxonomy).<\/strong><\/p>