Guidelines are presented as input for the UN High-Level Political Forum on Sustainable Development
ABN AMRO, ING and Rabobank today launched joint circular-economy finance guidelines internationally, inspired by the ambition to create a common framework for financing the circular economy worldwide.
The UN High-Level Political Forum is a UN conference in New York that starts today. At HLPF 2018 countries and businesses share their ambitions and targets to achieve the Sustainable Development Goals by 2030. These guidelines are a response to the growing need for a common language. This will provide a better insight into the contribution by the financial community for the transition towards a circular economy. Moreover, it will drive and enable financing and funding worldwide. On behalf of the FinanCE Working Group, they offer the guidelines as input for the High-Level Political Forum on Sustainable Development in New York.
Common understanding of what circular economy means
ABN AMRO, ING and Rabobank are all members of an international tie-up: the FinanCE Working Group, which was set up in 2014 by PGGM among other players and has close links to the Ellen MacArthur Foundation. It is made up of financial services companies looking to drive the transition to a circular economy. The financial community is in need of a uniform framework of guidelines for identifying, selecting, financing and enabling investors for initiatives based on new circular business models. The new guidelines help the financial community to establish whether or not initiatives are circular, for instance by monitoring recycling of products and materials and so ensuring that these retain and contribute the best possible multiple value. By introducing these guidelines, the three banks lay the groundwork for accelerating investment in and funding of circular business models. ABN AMRO, ING and Rabobank are encouraging financial players across the world to follow suit (‘right to copy’) – by drawing up these guidelines they are stimulating the work towards a uniform vision and best practices at a global level.
WANT TO BUILD A FINANCIAL EMPIRE?
Subscribe to the Global Banking & Finance Review Newsletter for FREE Get Access to Exclusive Reports to Save Time & Money
By using this form you agree with the storage and handling of your data by this website. We Will Not Spam, Rent, or Sell Your Information.
Finance guidelines for circular economy: first of their kind
The transition to a circular economy provides an important contribution to key transitions in the economy and produces visible environmental benefits and innovative collaboration. In a circular economy, the value of products and materials is maintained for as long as possible with a common perspective for stakeholders in the economy. Waste and resource use are minimized, and when a product reaches the end of its life, it is used again to create further value. This can bring major economic benefits, contributing to innovation, growth and job creation. The Circular Economy Finance Guidelines aim to promote and develop the role that finance can play in this transition. Financial institutions have a major role in the transition from the linear to the circular economy, as the latter sees the advent of a multitude of new business models that require different types of finance, where knowledge of business models is key.
Widely accepted recognized finance guidelines towards a circular future
The Ellen MacArthur Foundation also recognizes the importance of widely supported circular financing guidelines. “The financial industry plays a crucial role in accelerating the transition to a circular economy,” states Gerald Naber, Insights and Collaboration Manager at Ellen MacArthur Foundation. “With these guidelines, ABN AMRO, ING, Rabobank and the FinanCE Working Group are taking the lead in aligning banks and market players in their efforts to increase capital allocation to circular businesses.”
“We aim to lead on the transition to a more circular economy, as we believe we can and will make a real difference. By joining forces with ING and Rabobank in launching finance guidelines, we will facilitate the pioneers that are shaping the circular economy. Together, we can ensure that circular becomes the new standard,” adds Fred Bos, Senior Managing Director of Commercial Banking Clients at ABN AMRO.
Annemein Kolk, Head of Commercial Banking at ING Nederland, comments: “Developing the circular economy is a key focus for ING. However, at this point we lack generally accepted guidance on circular finance. The CE Finance guidelines offer a starting point for what we can see as circular initiatives in our industry and we hope they will facilitate the journey to such financing for financial services companies across the world.”
“Rabobank supports, encourages and actively contributes to the Sustainable Development Goals and the Paris Climate Accord. The transition to a circular economy offers key opportunities to companies and those who finance them,” observes Alain Cracau, Director of Sustainable Business Development at Rabobank. “That’s why it’s imperative we join forces around the world now and arrive at a uniform vision of how the financial community can contribute to achieving a circular economy.”