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Small & Midcap ESG challenges


Small & Midcap ESG challenges


An ambitious and complex transition plan is required to achieve the goals of the EU Green Deal, which are to transform the EU “into a fair and prosperous society, with a modern, resource-efficient and competitive economy where there are no net emissions of greenhouse gases in 2050 and where economic growth is decoupled from resource use,” and “protect, conserve and enhance the EU’s natural capital, and protect the health and well-being of citizens from environment-related risks and impacts”.

Indeed, the challenge there is to go far beyond the beneficial mobilisation of NGOs, large asset managers, banks or insurance groups, big caps and policy makers, in order to definitively mainstream the ESG initiative and even achieve a generalised timely appropriation of related stakes and opportunities, which are necessary to engage and deliver the deep changes required.

Small- and Mid-Caps (SMIDs) bring an essential contribution to the EU economy. Just waiting for their progressive involvement following best in class SMIDs, is irrelevant should the EU need to rapidly deepen the resilience and competitiveness of our economies as suggested by the Covid19 pandemic. Furthermore, certain SMIDs might progressively be unable to meet investors’ raising ESG expectations, and eventually lack financings.

According to a Eurofi working group that worked with the financial ecosystem of French SMIDs, this requires formal public policies intended to support the SMIDs implementing ESG approaches, improve ESG data accessibility and quality, preserve and develop the financial service providers able to monitor SMIDs’ extra-financial performance, and finally improve the access to finance of the SMIDs engaged in an ESG approach.

Contributions to the policy debate

Extracted from the main Eurofi publications (Regulatory Updates, Views Magazines and Conference Summaries)