8DECEMBER 2023The asset management industry provides for a massive potential to raise private capital for the fight against climate change ­ and, in particular, from retail clients. Going beyond financing, the asset management industry has the potential to become an active driver of changes in the real world of things when it comes to CO2 emissions produced or mitigated by real assets.When the EU Taxonomy and the Sustainable Finance Disclosure Regulation (SFDR) entered the surface of EU legislation, the whole financial industry had to work itself through the process of understanding the principles, impacts on products, processes, and financial models. The industry has seen an extensive need for sustainability advisors and the establishment of sustainability teams in-house. Two worlds had to make ends meet ­ sustainability professionals requiring higher standards to keep up with increasing environmental regulations and the world of total return. This was the turning point where EU regulation which has been pitied many times as self-absorbed by for example regulating a banana´s curve has set in motion real innovative processes.Apart from regulatory constraints, probably all industry leaders wondered whether investors would be willing to accept a decrease in return for the sake of sustainability if that would come along with it. For institutional investors, it is an active decision to spare basis points to meet the EU transparency criteria as `light green' Article 8 or `dark green' Article 9 products. However, in the retail sphere, the initiator takes the risk that investors are attracted by the product which depends on its design and management. The key is authenticity in structuring and managing an investment fund that claims to pursue an investment strategy targeting environmental tasks. Direct investments in real assets are more complex than liquid assets from an asset management perspective but are by far more comprehensible for the investor. Real assets are not chosen by algorithms and are at any time exchangeable by them. This increases credibility which might be relevant for the retail investor´s choice.By Dr. Constanze Jacobs, Head of Transactions, Structuring & Asset Advisory, Legal, Commerz Real AGROLE OF INVESTMENT FUNDS IN THE FIGHT AGAINST CLIMATE CHANGEDr. Constanze JacobsOPINIONIN MY
< Page 7 | Page 9 >