❯ 5 – Keeping pace with EU legislation

As the need to address climate change has risen rapidly to the top of political agendas, the EEMI has positioned itself as a unique and important nexus for key EU policy initiatives in the areas of sustainable finance, climate and energy policy:

First and foremost, through its efforts to mobilise the EU mortgage industry, the EEMI is a direct and concrete response to the policy priorities of the EU, particularly those of the EU Green Deal and Renovation Wave Strategy, to unlock the EU’s energy saving potential through private finance and guarantee the transition towards climate-neutrality by 2050. 

Furthermore, the EEMI is an important bridge between policy ambition and market reality, and as such will support implementation in the market of the EU Taxonomy’s building criteria. The EEM Label in particular provides a mechanism for banks to align to the requirements of the EU Taxonomy over time, demonstrate portfolio eligibility and deliver transparency and best practice at European and global levels. In turn, this will help banks to fulfil and disclose their Green Asset Ratio. The KnowShape Platform performs the protocol to assess the Taxonomy-Alignment of the real estate projects in order to enable their funding with Art. 5 financial instruments entering in the Green Asset Ratio.​

Finally, as the link between climate risk and financial stability has become increasingly recognised, the EU institutions are turning their attention to how ESG risks should be addressed from a supervisory perspective in the context of risk management and the capital framework. Through the EEM Label in particular, the EEMI is providing information on the portfolios of energy efficient loans, allowing for enhanced evaluation and tracking of their financial performance relative to alternatives, and provides greater transparency regarding climate risks and resilience. In this way, the EEMI is also supporting banks in meeting increasingly stringent and detailed disclosure requirements.