The concept of sustainability has come a long way since the United Nations conference on environment and development, held in Rio in 1992.
Over the 20-plus years since then, sustainability has become a driving force of Europe's thinking and policymaking. It has expanded to all corners of our society and brought along numerous parallel concepts.
In the European Commission we are currently looking at new ways to bring forward the concept of sustainability in the area of investments and financing. As far as I am concerned, the term 'sustainable investments' should be understood in its widest sense and include investments that are green, blue, low carbon etc.
The concept of sustainable investment cannot be restricted to projects focusing on new environmentally friendly technologies, although they are central to the idea. We also need to reflect on how to adapt the existing regulatory framework and help more sustainable financing tools to emerge.
If we want our economies to be more resilient in the wake of the evolutions linked to climate change, we need to provide compelling arguments to encourage the relocation of assets towards more sustainable solutions.
This Commission is highly committed to moving our market economy in a more sustainable direction. In the long run, this will help our economy to become more competitive and resilient, relieve the pressure on our resources and environment, create jobs and social cohesion, and spur innovation.
Last year, we reached landmark international agreements, with the adoption of the sustainable development goals and the Paris protocol.
Sustainable development is also at the heart of the EU's efforts; take for example the circular economy action plan, the energy union strategy and the Paris climate agreement follow-up communication.
I believe that finance has a key role to play in helping us transition towards a more sustainable world. For this we need to green public budgets in the EU and the member states and beyond.
Our strategies to promote green growth must be underpinned by an intelligent use of the EU's and member states' resources, focusing on increasing our efficiency and creating the necessary synergies to grasp all possible benefits.
We also need to move more actively beyond public finance and reach out to private investors, who will benefit from integrating long-term factors into investment activities, as would business and society at large.
This is recognised in the capital markets union, which includes a clear commitment from the Commission to promote and increase finance, including long-term finance, for environmental and sustainable investments.
We often hear that a key barrier for investors to take into account sustainability information is the lack of underlying data. In an e ort to improve this situation, we have brought forward initiatives to increase corporate transparency, such as the legislation on non-financial reporting that will be applicable by the end of the year.
It can sometimes be difficult for companies in environmental sectors to gain access to finance. This is due to a lack of understanding of new business models or the issues driving them. There is also an issue of scale and challenges in getting from innovation to the market. This may be perceived as a risky area. The European fund for strategic investments (EFSI) provides new financing opportunities and can be the catalyst bringing investors and project promotors together.
The aim is to mobilise €315bn worth of new investments with a maximum of private sector capital, initially over three years. Transitioning to a low-carbon, climate resilient and resource-efficient economy, and more broadly 'greening growth', will require significant investment, and hence private sources of capital on a much larger scale than in the past.
Investment needs for resource efficiency are estimated to be in the range of €422-527bn, and EFSI can help. Under the infrastructure and innovation window, the EFSI can, for instance, boost the building of biorefineries and renewable energy sources in Europe (e.g. Äanekoski bio-product mill).
Green investment projects worth around €16bn have been approved by the EIB for EFSI backing so far, with EIB financing under EFSI amounting to €3bn in 11 member states. This means that around half of the 57 projects approved so far in the infrastructure and innovation window are related to the green economy.
In the SME window, as of last month, 165 operations have been approved by the EIF for a total investment value of around €48bn. About 136,000 SMEs and Midcaps are expected to benefit, in 21 member states.
The era of plentiful and cheap resources is over. If we want to meet the needs of a growing global population within the sustainable limits of the planet's natural resources and ecosystems, we have to shift from a model of economic progress founded on labour productivity to a model based on resource productivity.
Tomorrow's economic growth will go hand in hand with resource efficiency.
Innovation and technologies are key to Europe's future and at the heart of the EU's policies. They are about using technological advances and new business models to reduce our environmental impact and make better use of our resources.