Sustainable Finance: Research and Policy Activities

Climate change is one of the megatrends that society is confronted with. In 2019, the European Union (EU) declared in the European Green Deal to transition to a sustainable economy until 2050, bringing up new challenges for the financial system. 

For financial markets, the consequences of climate change create new risks as well as a huge financing need to bear the costs of the transition toward a net-zero economy. At the same time, private investors’ interest in green and sustainable finance is rising. To make informed decisions from an economic and ecological perspective, it is important that information on environmental, social, and governance criteria (ESG) is available in a transparent and harmonized manner.

At SAFE, research looks into the impact on households, firms, and financial intermediaries and addresses issues like heterogenous ESG standards, regulatory loopholes, and greenwashing.

SAFE is part of the Frankfurt Panel on Sustainability Research and co-organized the First Sustainability Standards Watchers Conference in July 2022. Find out more about the conference.

Besides climate change, biodiversity loss is a global threat that cannot be resolved without the transformation of the economy with help from the financial sector. Therefore, in the context of the Fifteenth meeting of the Conference of the Parties to the Convention on Biological Diversity (CBD COP 15) in Montréal from 7 to 19 December 2022, SAFE's Founding Director emeritus Jan Krahnen signed and developed six demands and offers with an alliance of German science and research institutions to emphasize the importance of scientific advice and regulations in this field - the Frankfurt Declaration.