GUBERNA - Euronext New year’s Ceremony 2020: Sustainability in Finance-Time to Act!
At GUBERNA we believe good governance is the motor of our Belgian companies and directors are in the driving seat. However, no car and therefore no company moves forward without energy. To drive in the desired strategic direction, to reach the planned objectives and overcome obstacles on the way, every car needs the right type of energy. The financial sector is such an important energy source for companies as without enough financial means their very existence is threatened. In 2020, the year in which climate change will be undoubtedly higher on our agenda’s than ever before, one question, however, remains: is the financial sector a fossil fuel or a renewable source of energy?
As we are timewise almost half-way on the road to achieving the UN sustainable development goals but there is still a long way to go objective wise, we all know the answer to the above question should be the latter. But the reality is, as usual, somewhere in-between. Therefore, the theme of this year’s New Year Ceremony was Sustainability in Finance: Time to Act! On the 23rd of January GUBERNA and Euronext investigated together with experts in the field, how the balance between People, Planet, Profit in finance can be improved in the coming year(s). Over 500 people joined the evening full of inspiring exchanges in the form of keynote speeches, a panel debate, an award ceremony and a networking buffet at The Square in Brussels.
The event was kicked-off with some food for governance-thought by Sandra Gobert, Executive Director of GUBERNA. In her introductory speech on the state of governance, she looked back on the governance evolutions of the past year and connected the corresponding challenges and opportunities to the third wave of governance in the new year. 2019 was the year of awareness. Awareness that change is not just “a nice extra” but a necessity. In 2020 the enlargement of the corporate purpose “from financial value creation for the shareholders to a holistic approach of value creation for all stakeholders” is indeed a necessity. Companies already have the tools for this in their hands: The Shareholder Rights Directive II, the Corporate Governance Code 2020, several requirements for non-financial reporting…
This year companies and their boards must walk the talk. As important as compliance is, boards should dare to not just follow the road that is mapped for them but to build new roads. Ethical leadership takes a crucial position.
Sustainability is of course not a topic that is bound by national borders. Even though change is necessary on all levels of society and every individual can make a difference, the third wave of governance can only be impactful when hands are put together. A European approach is indeed indispensable. Philippe Lamberts, Co-President Group of the Greens/EFA spoke of what is moving on the European level. He underlined that companies can no longer “put a price tag” on everything, not everything valuable can be captured by a number. The European Union is strengthening the framework for sustainable value creation. In December last year, for example, the European Commission announced the European Green Deal (EGD): a roadmap that aims to transition Europe to the first climate-neutral continent by 2050.
The Green Deal includes among policy areas as “Sustainable and smart mobility”, “Clean Energy”, “A Farm to Fork agricultural policy” … also a section dedicated to Mobilising the industry for a clean and circular economy. In March 2020 the Commission will adopt an EU industrial strategy that will propose concrete measures to attain such a circular economy. It is already clear that these measures in large part will be based on the potential that a digital transformation can bring. To realise all the action points in the EGD, the Commission has estimated that there is an additional investment need of 260 billion euro annually (or 1 trillion in total). A Sustainable Europe Investment Plan was released on January 14th to fulfil this need. The plan aims to mobilise funding through the EU budget, by creating a framework for private investors and the public sector which facilitates sustainable investments and finally by providing better ways of identifying, structuring and executing sustainable projects. Regarding the last element, the European Council and Parliament already reached an agreement at the end of last year about the “Taxonomy Regulation” which will be an EU-wide classification system to identify which activities can be labelled as “environmentally sustainable”.
After an interesting European perspective, the new year’s ceremony continued with a lively panel debate, moderated by Sandra Gobert. Six experts, David Ballegeer (Linklaters), Marc Daelman (PwC), Linda Demunter (KBC Asset Management), Philippe Kunter (Bpifrance), Delphine Queniart (BNP Paribas) & Leonie Schreve (ING), brought critical reflections from their different areas of expertise to the table. The crucial role of banks as change agents was more than once highlighted. After this debate, Vincent Van Dessel, CEO & Chairman Euronext Brussels, gave a full update on the Brussels stock market. He also had a clear message for our (future) government, who has a key role to play in creating the right conditions for a healthy financial ecosystem. He pressed for the importance of reducing the withholding tax for both listed companies as SME’s as this would be a major incentive for retail investors.
Alexander De Croo, Deputy Prime Minister/Minister of Finance, and the last keynote speaker of the evening indicated that he was open to discussing such measures but that this might be beyond the scope of a caretaker government. He did, however, underline that sustainability is high on the current government agenda. Furthermore, he encouraged companies to take real actions and be careful with “greenwashing” as only real sustainability goes hand in hand with real profits. The Euronext Brussels Awards Ceremony, that followed the speech of De Croo, awarded Umicore for taking such real, impactful actions with gold in the sustainable growth category, followed by silver and bronze for Telenet and UCB respectively. 10 other awards were attributed to companies that went the extra mile last year in different ways before the evening was concluded with a networking buffet. The message that attendants took home was clear: we are moving in the right direction but there is still a long way to go to make finance really sustainable (and there are no self-driving cars).