The numbers are big; almost too big to comprehend. At EU level the ambitious targets outlined in the European Green Deal mean the European Commission has committed to mobilising €1 trillion in sustainable investments over the coming decade. This financial initiative is a cornerstone in the union’s strategy to usher in a greener, more resilient future.
Member states are mandated to direct a minimum of 37 per cent of the financial support they receive through the EU’s €672.5 billion Recovery and Resilience Facility towards investments and reforms that bolster climate-related objectives.
In her State of the Union address on September 13 the president of the commission, Ursula von der Leyen, set high targets for the European Green Deal with a nod to the role of technology in achieving this future.
“The future of our clean tech industry has to be made in Europe. It is the moment to show to the young generation that we can build a Continent where you can be who you are, love who you want and aim as high as you want,” she said. “A Continent reconciled with nature and leading the way on new technologies. A Continent that is united in freedom and peace. This is Europe’s moment to once again answer the call of history.”
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The commission sees climate change and environmental degradation as existential threats to Europe and the world. To overcome these challenges, it says, the European Green Deal will transform the EU into a modern, resource-efficient and competitive economy, ensuring:
- No net emissions of greenhouse gases by 2050
- Economic growth decoupled from resource use
- No person and no place left behind
The figures for Ireland are no less impressive; estimates from the International Monetary Fund suggest it will cost as much as €20 billion a year to fund our transition to a zero carbon economy by 2030.
AIB’s chief sustainability and corporate affairs officer, Mary Whitelaw, believes such projections require Irish banks to take a forward role. Conscious too that AIB is Ireland’s largest financial services provider, with 3.2 million customers, she sees the bank’s function as both responding to customer needs and helping them transition efficiently to a low carbon economy.
“Both consumers and suppliers are increasingly seeking to engage and work with companies that have strong environmental, social and governance (ESG) credentials, providing businesses with another reason to become more sustainable,” she says.
“At AIB we have produced a number of guides for different sectors, such as hotels, pubs and restaurants, and transport companies, that offer practical tips and advice on how companies can ensure they are making the right changes and maximising their return on investment for these changes.”
Whitelaw recommends people look to the AIB website which provides information on key resource-intensive areas including energy, waste, water, fleet efficiency, fuel alternatives and social sustainability.
“Due to a combination of customer demand and the need to do more, we have doubled our Climate Action Fund to €10 billion by the end of 2023, further supporting Ireland’s transition to a low carbon economy. We are on track to reach this target,” says Whitelaw.
One potential impediment is greenwashing. Owen O’Driscoll is CEO of Trrue, a platform seeking to harness intuitive digital investment using transparency to connect investors with ESG-verified companies. “One problem is that the term ESG has become polarising because people have become wary of greenwashing products,” he says.
Whitelaw also exercises caution. She says AIB is aware of the importance of providing customers with suitable products to meet their needs and expectations and does so with the support of robust product governance.
“Our policy is that their needs are considered right throughout the development and management of products,” says Whitelaw. “When designing new products and propositions we also factor in regulatory requirements and ensure we are compliant. Increasingly customers are interested in products and services with sustainability considerations and this is also included in our product governance.”
AIB is hosting its seventh annual sustainability conference on November 20th. Coming at a time when the impacts of climate change are being felt around the world, the conference theme is It’s Time To Act. The event is free and registration for those who wish to attend virtually is now open at aibsustainabilityconference.ie.