By Ophélie Mortier,
Chief Sustainable Investment Officer


Last week, over 2,400 representatives of the 5,200 signatories of the Principles for Responsible Investment (PRI) gathered in Barcelona for the annual PRI conference. These global asset owners and managers represent over USD 121 trillion in assets, making the PRI an important lever for sustainable finance. While the conference may seem to promote greenwashing to some, we need to objectively examine the meaning of the term before drawing any hasty conclusions.

Let’s start off with a brief look at the European Taxonomy. This framework addresses the 98 economic activities that contribute the most to greenhouse gas emissions in Europe, making up over 80% of all European emissions. The Taxonomy aims to make these activities more sustainable through its climate change mitigation and adaptation objectives. To some extent, the taxonomy aims at making greener brown sectors… Its primary goal is therefore not to cover all European companies, but rather to target the most carbon-intensive industries in Europe to reduce carbon emissions and address climate change. This taxonomy leads to focus on certain sectors, such as real estate, utilities and transportation, which are not intuitively associated with “impact investing”. Even so, regardless of this sectorial bias, reducing carbon emissions in the most polluting sectors is probably one of today’s most pressing challenges. This aligns with the European Commission’s sustainable finance plan, which aims to direct financial flows towards the real economy; until today, finance has been disconnected from the real economy, as Emmanuel Fabre, the president of the International Sustainability Standards Board (ISSB), rightly mentioned at the closing of the PRI conference. By simply avoiding and ignoring the big polluters (some of which are actually already working on their own sustainable transitions), we completely overlook the crux of the issue.

Today, sustainable finance is caught in a vice

    • Between the risk of being accused of either ‘green washing’ or ‘green bleaching’1
    • Between financing the energy transition in a fair manner but DNSH2-compliant manner
    • Between transparency and disclosure regulations and an interpretation of these more suited to a product labelling process


Indeed, these ongoing issues worry the sustainable investment community in Europe. They are preoccupied with possible ‘greenwashing’ allegations or making potentially false claims about their environmental practices. As a result, some are avoiding the spotlight and revert to less strict classifications for their products. However, this then comes with a risk of green-bleaching. The investment community seems to be facing a real catch-22.

Let’s also remind ourselves that 100% impact investments are particularly few and far between. For example, investing in wind turbines can help with the energy transition and combat global warming, but it can also harm biodiversity and natural resources. Activities that have a purely positive environmental impact are hard to find, and even if they do exist, their impact on the planet is limited. Instead of addressing the main issue, they would mainly focus on the symptoms. In short, the root cause of environmental problems must be addressed in order to make a meaningful difference, even if the ways to do so can seem contradictory at first glance.

We should not forget that the European legislation that regulates sustainable finance is known as the Sustainable Financial Disclosure Regulation (SFDR). Its main goal is to fosters the disclosure and categorisations of financial products. The regulation does not provide any actual definitions or standards for what is considered to be ‘environmentally or socially responsible’. This means that different organisations can interpret these rules differently, and that national regulators can also interpret them in their own ways. As of today, there is no regulatory text that mandates certain activities to be excluded. The SFDR is essentially about holding companies accountable to their promises, and making sure that they ‘do what they say and say what they do’.

In conclusion, we should not let the perfect be the enemy of the good. In fact, it would be unfortunate if committed and engaged actors stopped taking action due to imperfect data, approaches, or definitions. DPAM is proud of its progress, such as:

    • Engaging with Follow This to advocate for oil majors’ net zero commitments;
    • Working with UNI Global Union to improve Teleperformance’s social practices;
    • Joining the ADVANCE (human and social rights) collaborative engagement initiative with PRI, which is the second largest engagement initiative after Climate Action 100+, where we have secured tangible environmental commitments from players such as Heidelberg cement;
    • Financing green bonds worth EUR 1,2 million from governments and companies;
    • Engaging with sovereign issuers on a positive and constructive agenda towards greater sustainability for governments;
    • Convincing companies like Sungrow to move their solar panel production away from Xinjiang (to name but a few).


Let’s continue to strive for progress, even if ‘perfection’ is not always available.

1. ‘Green bleaching’ refers to the opposite of ‘greenwashing’. It applies to companies that Invest in activities that are environmentally friendly, but don’t advertise them to avoid the data problems arising from the disclosure obligations.

2. ‘Do no significant harm


Degroof Petercam Asset Management SA/NV l rue Guimard 18, 1040 Brussels, Belgium l RPM/RPR Brussels l TVA BE 0886 223 276 l

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