Integrating ESG-SRI into the local financial network

Monaco is pushing ahead with plans to incorporate sustainable finance into the banking and financial institutions of the Principality and will also create a global conference to support its efforts.
Monaco Sustainable Finance is an ambitious initiative created in March 2021 based around three primary objectives: protection of the planet, development of new practices and championing innovation by investing in new technologies.
The third session of the Monaco Sustainable Finance joint working group met on Friday 1st October at the Ministry of State. Minister of Finance and the Economy Jean Castellini chaired the meeting that was held with several representatives of the Monegasque Association for Financial Activities and the Commission for the Control of Financial Activities.
The meeting’s goals were to present the first findings of the ‘ESG – SRI’ questionnaire that several banks and portfolio managers in the Principality responded to over the summer. ESG stands for Environmental, Social and Governance, the criteria to assess the inclusion of sustainable development and long-term issues in companies’ strategy, and SRI stands for Socially Responsible Investment.
“In a globalised economy, the success of both corporate and investment strategies is increasingly dependent on ESG or SRI selection criteria,” said the government when it first created the group. “Incorporating these factors as part of analysis, financial investment and risk management is likely to improve yields, but also to reduce risks, especially systemic risks.”
The meeting found there were “encouraging results” from the questionnaire and agreed they would move forward in 2022 with several plans.
First, they will create a dedicated ESG correspondent within institutions to keep everyone abreast of current policies and plans. They will also extend sustainable finance training to all employees, not limiting it to management. Additionally, they will define the terms of reporting for clients with local institutions, with the hope of a streamlined system that makes it easy for all. Finally, they are looking to organise an international conference in Monaco based around the theme of sustainable finance in order to get input and share ideas with other countries on their handling of this important issue.

Photo: Kick-off meeting for the Monaco Sustainable Finance initiative, on 19th March by Stéphane Danna/Communication Department